Cabinet approves Farmers' Debt Relief Fund
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The central government today has decided to set up a Farmers' Debt Relief Fund with an initial corpus of Rs 10,000 crore to implement the farm loan waiver scheme announced in the general budget to help about four crore peasants.
The fund, according to the decision taken at a meeting of the Union Cabinet today, would be augmented by another Rs 50,314 crore in the next four years to compensate the banks and other lending institutions on account of losses resulting from farm loan waiver scheme. The government will initially provide Rs 10,000 crore to the Fund, which has been earmarked in the supplementary demands for grants for 2007-08. The Rs 60,000 crore debt waiver scheme announced by Finance Minister P Chidambaram in the budget for 2008-09 will be implemented by June 30. The debt waiver and debt relief scheme will benefit three crore small and marginal farmers and one crore other farmers. In addition to Rs 10,000 crore that has been earmarked in 2007-08 for funding the scheme, the government will provide Rs 15,000 crore each in 2008-09 and 2009-10, Rs 12,000 crore in 2010-11 and Rs 8,314 crore in 2011-12. Pointing out that the implementation of the scheme will mitigate hardships faced by farmers, an official spokesperson said, "Upon being granted the debt waiver or signing an agreement for debt relief under the One Time Settlement (OTS), the farmer would be entitled to fresh agricultural loans from the banks." (PTI)
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