Amid growing demand to write off farm loans, Minister of State for Finance Santosh Kumar Gangwar has said that there is no proposal under consideration of the union government, to waive loans of farmers of the country but major initiatives have been taken by the government to reduce the debt burden. He noted that the schemes are available to reduce costs by timely repayment of the amount borrowed.
Talking about the government initiatives to help the farmers, Gangwar said that under the Department of Agriculture, Cooperative & Farmers' Welfare with an interest subvention scheme, the government provides short-term crop loans up to Rs 3 lakh at subsidised interest rate of 7 per cent per annum. Besides, an additional incentive of 3 per cent is provided to farmers for prompt repayment of loans within due date, making an effective interest rate for them at 4 per cent.
Gangwar also said that lending agencies are instructed to provide relief measures in cases of natural calamities that not only restructures existing crop loans but also extends fresh loans. He further said that the benchmark for initiating relief measures by banks has also been reduced to 33 per cent crop loss in line with the National Disaster Management Framework.