Farmers’ loan waiver affects ‘heavy' on farmers itself
Monday - December 31, 2018 3:43 pm ,
Category : WTN SPECIAL
The banks' agricultural credit growth rate came down drastically in the last financial year
'Side effects' of farmers’ loan waiver: Growth rate of agricultural debt came down from 12.4 in the previous financial year to 3.8 percent
DEC 31 (WTN) - In the 2018 assembly elections in Madhya Pradesh, Congress announced farmers’ loan waiver scheme in its manifesto, after which the Congress defeated the BJP in the assembly elections and formed the coalition government in a tough fight. During the election campaign, Congress national president Rahul Gandhi and all the Congress leaders in the state had said that if Congress came to power, the loan will be apologized within 10 days.
Even after the assembly elections, the Congress formed the government and announced the terms and conditions of farmers’ loan waiver scheme. But farmers are annoyed with the announcement of the farmers’ loan waiver scheme because they are alleging that the Congress has false promised and put the conditions of the rules in the farmers’ loan waiver scheme, so that about 90 per cent of the farmers have been out of the real loan waiver scheme.
In addition to Madhya Pradesh, in Chhattisgarh and Rajasthan, the Congress government has declared the farmers’ loan waiver scheme, after which there is a continuation of discussion in the country whether farmers’ loan waiver is the only solution to the problem of farmers? But now indicating the farmers’ loan waiver’s side effect, the Reserve Bank of India has advised the political parties and governments with that if the farmers' loan waiver be continued then in the coming time the banks would think hundred times for waiving the loan for the farmers.
In fact, according to the RBI data, the growth rate for agricultural loan was 12.4 per cent in the financial year 2016-17, but this has reduced to only 3.8 per cent in the financial year 2017-18. In the first six months of the current financial year, the rate was 5.8 percent. So here, for lack of credit for agricultural work, the Reserve Bank has held responsible to farmers' loan waiver.
Banks have no objection in lending to farmers because banks have to lend them, but it has been for a considerable time, that the farmers stop paying their debts as soon as the political debate on farmers' loan waiver begins. At the same time, after the fear of not getting back loans from the farmers, the bank also starts paying obeisance in farmers’ loan waiver. Because banks feel that the debt burden increases due to farmers’ loan waiver plans. Banks also have to carry out their own work. In such a situation, if the farmers will continuously be defaulter, then the banks will be closed one day.
For your information, let you know that many economists, including former RBI governor Raghuram Rajan and former chairperson of the State Bank of India, Arundhati Bhattacharya have criticized the farmers’ loan waiver and said that it has a side effect on the economy. According to Raghuram Rajan, due to farmers’ loan waiver, there is a negative impact on the state and central economy and its impact will be seen in the future.
For your information, let us know that former RBI governor Rajan had said about the farmers’ loan waiver, "The biggest benefit of the farmers’ loan waiving goes to cagy person, rich farmers gain benefit of the farmers’ loan waiver instead of poor farmers. Even when the loan is waived, the revenue of the country is also damaged."
Former Governor Raghuram Rajan had demanded a ban on the promise of the farmers' loan waiver. If economists are to be believed, there is a loss to farmers from the farmer’ loan waiver schemes, because the farmers don’t pay loans to the banks after the announcement of the loan waiving, due to which the banks are reluctant to lend the loans to the farmers. As we told you earlier, the growth rate for farming related loan in the financial year 2016-17 was 12.4 percent, but in the financial year 2017-18, it dropped to only 3.8 percent.
It is clear from the figures that banks have skimped to waive the loan to the farmers as the farmers are not paying their debts on time and banks have to bear the consequences. If one wants to keep the economy of the banks on the track, it is important that political parties should not make electoral promises like farmers' loan waiver. Because if these continues in futures, the farmers will not pay the loans to the banks and the bank will be hesitated to lend to the farmers, which will be the biggest loss to the farmers.
DEC 31 (WTN) - In the 2018 assembly elections in Madhya Pradesh, Congress announced farmers’ loan waiver scheme in its manifesto, after which the Congress defeated the BJP in the assembly elections and formed the coalition government in a tough fight. During the election campaign, Congress national president Rahul Gandhi and all the Congress leaders in the state had said that if Congress came to power, the loan will be apologized within 10 days.
Even after the assembly elections, the Congress formed the government and announced the terms and conditions of farmers’ loan waiver scheme. But farmers are annoyed with the announcement of the farmers’ loan waiver scheme because they are alleging that the Congress has false promised and put the conditions of the rules in the farmers’ loan waiver scheme, so that about 90 per cent of the farmers have been out of the real loan waiver scheme.
In addition to Madhya Pradesh, in Chhattisgarh and Rajasthan, the Congress government has declared the farmers’ loan waiver scheme, after which there is a continuation of discussion in the country whether farmers’ loan waiver is the only solution to the problem of farmers? But now indicating the farmers’ loan waiver’s side effect, the Reserve Bank of India has advised the political parties and governments with that if the farmers' loan waiver be continued then in the coming time the banks would think hundred times for waiving the loan for the farmers.
In fact, according to the RBI data, the growth rate for agricultural loan was 12.4 per cent in the financial year 2016-17, but this has reduced to only 3.8 per cent in the financial year 2017-18. In the first six months of the current financial year, the rate was 5.8 percent. So here, for lack of credit for agricultural work, the Reserve Bank has held responsible to farmers' loan waiver.
Banks have no objection in lending to farmers because banks have to lend them, but it has been for a considerable time, that the farmers stop paying their debts as soon as the political debate on farmers' loan waiver begins. At the same time, after the fear of not getting back loans from the farmers, the bank also starts paying obeisance in farmers’ loan waiver. Because banks feel that the debt burden increases due to farmers’ loan waiver plans. Banks also have to carry out their own work. In such a situation, if the farmers will continuously be defaulter, then the banks will be closed one day.
For your information, let you know that many economists, including former RBI governor Raghuram Rajan and former chairperson of the State Bank of India, Arundhati Bhattacharya have criticized the farmers’ loan waiver and said that it has a side effect on the economy. According to Raghuram Rajan, due to farmers’ loan waiver, there is a negative impact on the state and central economy and its impact will be seen in the future.
For your information, let us know that former RBI governor Rajan had said about the farmers’ loan waiver, "The biggest benefit of the farmers’ loan waiving goes to cagy person, rich farmers gain benefit of the farmers’ loan waiver instead of poor farmers. Even when the loan is waived, the revenue of the country is also damaged."
Former Governor Raghuram Rajan had demanded a ban on the promise of the farmers' loan waiver. If economists are to be believed, there is a loss to farmers from the farmer’ loan waiver schemes, because the farmers don’t pay loans to the banks after the announcement of the loan waiving, due to which the banks are reluctant to lend the loans to the farmers. As we told you earlier, the growth rate for farming related loan in the financial year 2016-17 was 12.4 percent, but in the financial year 2017-18, it dropped to only 3.8 percent.
It is clear from the figures that banks have skimped to waive the loan to the farmers as the farmers are not paying their debts on time and banks have to bear the consequences. If one wants to keep the economy of the banks on the track, it is important that political parties should not make electoral promises like farmers' loan waiver. Because if these continues in futures, the farmers will not pay the loans to the banks and the bank will be hesitated to lend to the farmers, which will be the biggest loss to the farmers.
