Union Finance Minister Arun Jaitley must intervene and grant a special bailout package for farmers to bring them under institutional credit cover, Kishore Tiwari, chairman of a task force set up to tackle Maharashtra’s agrarian issues said on Sunday.
He said that eight million farmers have been affected by drought and public sector banks in the state had failed to achieve crop loan targets set for them by the Reserve Bank of India and the National Bank for Agriculture and Rural Development.
“Hence the special task force has now approached Union Finance Minister Arun Jaitley for his urgent intervention and asked him to grant a special bailout package so that every debt-ridden farmer is brought under institutional credit cover,” Tiwari, chairman of the Vasantrao Naik Shetkari Swavalamban Mission, said.
In a release issued here on Sunday, Tiwari said that figures made available by the State Lead Bankers Committee after a review meeting held at Pune Friday showed that public sector banks in Maharashtra had achieved only 41 per cent of the crop loan target.
He informed that despite the Maharashtra government announcing a farm loan waiver of Rs 14,000 crore, PSU banks had achieved only 30 per cent of their crop loan targets in 14 districts of Marathwada and Vidarbha.
“The banks have disbursed only Rs 11,000 crore against a target of Rs 28,000 crore in these 14 districts, which have witnessed several farmer suicides over the past few years,” he said.
Tiwari said that a reduction in the interest rate for crop loans by the state government was not helpful since a large number of farmers had defaulted on bank loans earlier and were, thus, ineligible for fresh institutional credit.
“The state government has announced reduction of interest rate on crop loan from 9 per cent to 6 per cent. But when only 5 per cent farmers are taking farm loans from banks, what is the use of this reduction,” he asked.
“In Vidarbha, out of 3.2 million cotton growers, 2.8 million farmers are old defaulters of bank loans and not eligible for institutional credit,” he pointed out.