NewsClick

NewsClick
  • हिन्दी
  • Politics
  • Economy
  • Covid-19
  • Science
  • Culture
  • India
  • International
  • Sports
  • Articles
  • Videos
search
menu

INTERACTIVE ELECTION MAPS

image/svg+xml
  • All Articles
  • Newsclick Articles
  • All Videos
  • Newsclick Videos
  • हिन्दी
  • Politics
  • Economy
  • Science
  • Culture
  • India
  • Sports
  • International
  • Africa
  • Latin America
  • Palestine
  • Nepal
  • Pakistan
  • Sri Lanka
  • US
  • West Asia
About us
Subscribe
Follow us Facebook - Newsclick Twitter - Newsclick RSS - Newsclick
close menu
×
For latest updates on nCOVID-19 around the world visit our INTERACTIVE COVID MAP
Agriculture
Elections 2019
Politics
India

Is Loan Waiver Scheme the Solution for Karnataka Farmers’ Plight?

Chief Minister H D Kumaraswamy announced on Wednesday, June 12, that the farm loans would be waived off in one go. However, the question of non-institutional loans still remains unanswered.
Yogesh S
15 Jun 2019
Is Loan Waiver Scheme the Solution for Karnataka Farmers’ Plight?

Representational Image. Image Courtesy: IANS

Karnataka government on June 12, 2019, announced that it would release the full money required to waive off the farm loans in the commercial banks of the farmers across the state. In its election manifesto, the ruling Janata Dal (Secular) had stated that the government would waive off all agriculture loans in a single go. This would include crop loans, horticulture loans, and medium-term loans availed by the Karnataka farmers. In their maiden budget presented on July 9, 2018, the government had announced the farm-loan waiver scheme but in stages.

Chief Minister H D Kumaraswamy had announced waivers amounting to Rs 34,000 crore, while the total farm loans amounts to around Rs 1.20 lakh crore. The government had to reimburse Rs 10,500 crore to banks for the loan waiver scheme the previous year, and would be generating funds for the rest of the amount through an increase in taxes on fuel, electricity, motor vehicles and alcohol, as announced in the budget. In the second phase, an incentive of Rs 25,000 had to be distributed to the 27.67 lakh farmers who had repaid their loans on time ‘to prevent complaints that only defaulters have benefited’. This had displeased many farmers who had expected their burden of loans would be cleared off in a single go.

Also Read: K’taka Farmers Protest for Loan Waivers, Demands the Govt Fulfil its Pre-Poll Promises

According to a report by The Hindu, so far, of the estimated Rs. 8,550 crore required to fund various types of loan accounts in commercial banks, the government has already released Rs. 3,930 crore towards 7.49 lakh accounts. The government will have to release about Rs. 4,620 crore to complete the waiver process in commercial banks of which about Rs. 1,219 crore is ready for disbursal. In the budget for the financial year 2018-2019, the government had allocated Rs. 6,500 crore for the scheme, and Rs 6,150 crore for the year 2019-2020. However, as NewsClick had reported earlier, a total of 13,988 farmers have lost the money which were deposited into their accounts in nationalised banks as part of the state government’s loan waiver scheme.

Most of the small farmers and landless labourers avail loans from the local money lenders and these loans are lent with higher rates of interests, sometimes up to 20%. According to the Karnataka Money Lenders and Pawnbrokers Act 1961, a moneylender is an individual or an undivided Hindu family or a company or an incorporated body of individuals, who or which carries the business of money lending in the state. Debtors availing loans from these moneylenders fall into a vicious debt trap, as it becomes impossible for them to repay the principal amount. The moneylenders usually resort to extreme steps of public humiliation and unlawful methods and harass the defaulters of the debts. According to a report in the Deccan Herald, “While there is no official figure on total such loans availed, Karnataka has 8,274 pawnbrokers and 10,692 moneylenders registered in the state.”

Also Read: #DroughtDistress: Karnataka Runs Dry for Fourth Consecutive Year

A study conducted by the Institute for Social and Economic Change (ISEC), Bengaluru, in 2015 had shown that, “Non-institutional loan was one of the causes of the farmers’ suicides and 85% of the Karnataka households surveyed in the study, identified crop loan as the most important reason behind the suicide committed by a family member of the household.”

One has to note that the farmers in the state are in severe distress due to the four consecutive years of drought. It has been said time and again by experts that the state government should work out a plan that would help farmers in the long run. As former director of ISEC, Professor R S Deshpande rightly observes, “The state has a disproportionate share of drought-prone areas in the country. The losses incurred by the farmers in the last three years due to drought had made it impossible for them to repay their loans. The state is yet again facing a severe drought situation and there has been a severe crop loss in 100 out of 175 talukas.”

According to the statistics provided by the State Agriculture Department, 3,515 farmers were reported to have committed suicide from April 2013 to November 2017, which is a sharp increase from 1,125 cases of farmer suicides in the period April 2008 to April 2012. Out of the 3,515 suicide cases reported, 2,525 cases were due to drought and crop failure.

There is a need of scientific solution, and the government as its predecessors, instead continue to look at farmers as vote banks. They continue to be occupied with the populist schemes such as the loan waiver scheme. Even though CM Kumaraswamy has clarified that this move of the government has got nothing to do with the recent general election results, would this scheme resolve the agrarian crisis in the state? The question remains unanswered.

Also Read: Karnataka Assembly Passes Debt Relief Bill 2018 to Reduce Farmers’ Woes

Get the latest reports & analysis with people's perspective on Protests, movements & deep analytical videos, discussions of the current affairs in your Telegram app. Subscribe to NewsClick's Telegram channel & get Real-Time updates on stories, as they get published on our website.
farm loan waiver
Karnataka Government
Farmers Suicide in India
Farmers Suicide in Karnataka
H D Kumaraswamy
farm loans
JDS
Related Stories
With By-Polls Due and Farm Bills Passed at Centre, MP Govt. Tries to Placate Farmers

With By-Polls Due and Farm Bills Passed at Centre, MP Govt. Tries to Placate Farmers

The Truth Behind Modi’s Agri Infra Investment

The Truth Behind Modi’s Agri Infra Investment

Opposition Urges CM Nitish to Intervene

Bihar: Opposition Urges CM Nitish to Intervene After Karnataka Govt. Cancels Trains for Migrant Workers

COVID-19: Patient Commits Suicide

COVID-19: Patient Commits Suicide, Death Toll Reaches 20 in Karnataka

Unsold Rabi, Unsown Kharif Crop – Farmers in Gujarat Dread a Looming Agrarian Crisis

Sell Cocoon

COVID-19 in Rural India–II: ‘I Had to Sell Cocoon @Rs 150/kg,Instead of Rs 500/kg’

Maharashtra Govt Set to Waive up to Rs 2 Lakh Farmer Loans

Maharashtra Govt Set to Waive up to Rs 2 Lakh Farmer Loans

Karnataka: Marching Anganwadi

Karnataka: Marching Anganwadi Workers Receive Written Assurance, Defer Protest

Karanataka Bypolls: BJP Retains Majority in Assembly, Set to Win 12 Seats

Karanataka Bypolls: BJP Retains Majority in Assembly, Set to Win 12 Seats

Laxman Savadi

Karnataka Bypolls: BJP Rebels Protest, Assets of Defectors Show Increase

Share on FacebookShare on TwitterShare on WhatsAppShare via EmailShare on RedditShare on KindlePrint
Share
Share on FacebookShare on TwitterShare on WhatsAppShare via EmailShare on RedditShare on KindlePrint
Share

Related Stories

PTI

Karnataka Transport Corporation Employees' Strike Enters Third Day

12 December 2020
Bengaluru: The employees of the State-owned tr
Kashif Kakvi

MP Bypolls: Earlier BJP Supporters, Farmers now Oppose Farm Laws and Model Mandi Act

28 October 2020
Bhopal: The dissatisfaction among farmers over th
Newsclick Report

Bundelkhand Farmers Allege Rural Bank Defrauded Them, Begin Indefinite Hunger Strike

21 October 2020
Farmers from several districts of Uttar Pradesh’s Bundelkhand region went on an indefinite hunger strikeon Monday at the district headquarters of a

Pagination

  • Next page ››

More

  • Odisha: Similipal Fires Continue While Govt Claims Situation Under Control 

    Odisha: Similipal Fires Continue While Govt Claims Situation Under Control 

  • Pope Francis, Iraq's Top Shiite Cleric Hold Historic Meeting on ‘Peaceful Coexistence’

    Pope Francis, Iraq's Top Shiite Cleric Hold Historic Meeting on ‘Peaceful Coexistence’

  • Bengal Elections:  TMC List Flooded with Celebrities, 3 Seats for GJM’s Gurung Faction

    Bengal Elections: TMC List Flooded with Celebrities, 3 Seats for GJM’s Gurung Faction

  • TMC, AIADMK Release Candidate List for Assembly Polls

    TMC, AIADMK Release Candidate List for Assembly Polls

  • Load More
Subscribe
connect with
about