The Hindu : New Delhi News : Give farm inputs, not loan waivers: YSR

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Tuesday, Feb 05, 2008
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Give farm inputs, not loan waivers: YSR

Special Correspondent

Chief Minister discusses State’s budget priorities with Prime Minister and Union Finance Minister

‘Loan waivers benefited only 50 per cent of small and marginal farmers’
‘Frequent waivers could become incentive to farmers not to pay back loans’

NEW DELHI: Andhra Pradesh Chief Minister Y. S. Rajasekhara Reddy on Monday urged the Centre to consider giving input subsidy to farmers instead of loan waivers as institutional finance can be accessed only by 50 per cent of the small and marginal farmers of the country.

Dr. Reddy made this submission to both Prime Minister Manmohan Singh and Union Finance Minister P. Chidambaram when he met them to discuss the State’s priorities in the forthcoming Budget. Briefing mediapersons after his meetings, the Chief Minister said while the UPA government had done a lot to lift the lot of farmers, more still remains to be done.

Farm debts

Referring to widespread indebtedness among farmers – either to institutional financers or private money lenders – Dr. Reddy said loan waivers benefited only 50 per cent of the small and marginal farmers. Also, he was of the opinion that loan waivers only benefited those who are not regular in their repayments, and frequent waivers could in turn become an incentive to farmers not to pay back their loans.

An input subsidy of Rs. 5,000 per farmer annually for three consecutive years would be the best alternative under the prevailing circumstances, the Chief Minister said. The subsidy should be given to them in the form of cheque/demand draft payments as this would make them open bank accounts and thereby come out of the clutches of private money lenders.

During his meeting with the Finance Minister, Dr. Reddy sought an additional loan for the Accelerated Irrigation Benefit Programme. Referring to the State’s performance in this regard over the past three years, the Chief Minister said he had asked for an allocation that was higher than had been budgeted for.

Irrigation projects

Further, the Chief Minister urged the Prime Minister to ensure early clearances to a number of irrigation projects that the State government has planned. Since, the Supreme Court has to be approached in this regard, he said the Centre should request the Apex Court to delegate the powers of according statutory clearances for public-funded water resource projects to the statutory authorities as per prevailing law.

The irrigation projects pending clearance include K. P. Canal System of the Telugu Ganga Project, Indira Sagar (Polavaram) Project, Poola Subbaiah Veligonda Project, construction of Modikunta Vagu Project in Khammam, Vamsadhara Project, and improvement of Rasula Cheruvu Tank in Mahabubnagar.

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