Debt-waiver scheme extended by six months for medium, big farmers | business | Hindustan Times
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Debt-waiver scheme extended by six months for medium, big farmers

With worries of a delayed monsoon looming large, the government has decided to extend the date for availing the one-time debt waiver package by six months to December 31 for farmers with more than two hectares of land, reports Mahua Venkatesh.

business Updated: Jul 07, 2009 01:41 IST
Mahua Venkatesh

With worries of a delayed monsoon looming large, the government has decided to extend the date for availing the one-time debt waiver package by six months to December 31 for farmers with more than two hectares of land.

This is the third time that the date has been extended for farmers.

In a significant move, Union finance minister Pranab Mukherjee also said a task force would be set up to address the concerns of farmers in Maharashtra who have taken loans from non-institutional sources like private moneylenders. Farmers outside the institutional credit net usually borrow from moneylenders at a significantly higher rate of interest.

“Under the agricultural debt waiver and debt relief scheme, farmers having more than two hectares of land were given time up to 30th June, 2009 to pay 75 per cent of their overdues. Due to the late arrival of monsoon, I propose to extend this period by six months up to 31st December 2009,” Mukherjee said, while presenting the Union Budget on Monday.

The extension of debt waiver scheme, however, is likely to benefit the medium and big farmers, who comprise only 20 per cent of the total farming community. The small and marginal farmers who come under the banking net have already availed the benefit under the scheme.

“This extension of the date is not likely to have a significant impact as farmers with more than two hectares of land comprising only about 20 per cent are eligible to avail the benefit,” Dilip Mukherjee, general secretary, All India Regional Rural Bank Employees’ Association told HT.

Poor infrastructure has proved to be a major hurdle for farmers who have tried to avail the benefits of the debt waiver scheme.