PM reluctant on 'debt waiver' for farmers

Prime Minsiter Manmohan Singh said there could be 'no one-size fits-all solution,' for the farmers, reports Aloke Tikku.

india Updated: Oct 31, 2006 01:11 IST

Prime Minister Manmohan Singh on Monday made known his reluctance to immediately accept demands of a "debt waiver" for small farmers, emphasising any solution proposed on this line would have to factor in the "far reaching implications" such waivers had on the banking and financial system of the country.

Singh said problems faced by farmers living in chronically drought-prone and flood prone areas deserved “special attention” but there could be no “one-size fits-all solution. The “problems vary from region to region, state to state, crop to crop, land holding to land holding and irrigated land to dry land farms."

Singh’s comments came in course of a meeting with former minister Mohan Dharia who has threatened to go on a hunger strike from November 14.Singh asked him to refrain from going ahead as “it could only precipitate matters”.

Dharia has demanded immediate writing-off debts of small farmers, declaring debts taken from illegal moneylenders as illegal and lowering interest rate on farm loans to 4 per cent.

The prime minister said a decision on the solutions would have to be based on a proper analysis of facts and data so that their full implications are understood well in advance.

Acknowledging that there was a need for early action in this regard, Singh said he had entrusted an expert group under economist Dr R Radhakrishna to study the problem of agricultural indebtedness and spell out the way out. It is expected to complete the report by November-end.

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First Published: Oct 31, 2006 01:11 IST