The Hindu : National : Maharashtra to pay interest on farmers' loans

Online edition of India's National Newspaper
Wednesday, Aug 18, 2004

National

National

Maharashtra to pay interest on farmers' loans

By Our Special Correspondent

MUMBAI, AUG 17. The Congress-NCP led Democratic Front Government has decided to bear the interest on the agricultural loans of small and marginal farmers.

The Chief Minister, Sushilkumar Shinde, told reporters after a Cabinet meeting today that the step would benefit 30-lakh farmers and cost the State exchequer Rs. 211 crores.

Mr. Shinde said the farm loans for Rabi 2003 and Kharif 2004 seasons, amounting to Rs. 1627 crores, would be covered. Of these, 70 per cent loans were borrowed from cooperative banks and the rest from the nationalised banks. The State would pay Rs. 151 crores to the cooperatives and Rs. 60 crores to the public sector banks toward the interest.

Seen as another sop

Though he said that the measure was aimed at helping the drought-hit farmers, this is considered to be yet another sop to farmers by the cash-strapped government when the elections are due to be announced.

The State had already decided, to provide from July 1, free electricity to all farmers for running water pumps.

The Maharashtra Electricity Board was to be paid about Rs. 1,200 crores a year. While the ecologists and economists have questioned the wisdom of supplying free power to the farms, the Maharashtra Electricity Regulatory Commission is considering the whole issue.

The Opposition — which found that its plank of free power was hijacked by the Government — criticised the announcement of free power saying it was small relief and the farmers needed to freed of debts.

The Government, which itself is ridden with the debt of Rs. 92,000 crores, has opted for paying the interest on loans for two seasons.

Printer friendly page
Send this article to Friends by E-Mail

National