Karnataka: Only less than half of crop loans waived in two years

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Two-years since the announcement of the ambitious crop loan waiver scheme (CLWS), outgo from the state exchequer for the programme was less than half of the Rs 34,000 crore announced by the Congress-JD(S) coalition government. According to data, crop loan waived by the government was Rs 15,256.67 crore with only a small percentage of loan waivers pending.

Farmer leaders say that the populist measure of the government failed to benefit many farmers due to the conditions imposed for waiver after CLWS was announced. Experts find similarities in Karnataka and Maharashtra’s waiver scheme, arguing that the disparity between projections and actual figures was due to the weeding out of bogus accounts.

Details furnished in the Legislative Assembly recently by Co-operation Minister S T Somashekar shows that the number of beneficiaries under CLWS from co-operative banks was 17.06 lakh, eligible for a waiver of Rs 7,987.47 crore. Government has also identified 9.22 lakh beneficiaries of crop loans from commercial banks and set aside Rs 7,269 crore.

Among those who availed loans from co-operative banks, the government has waived Rs 7,692 crore of 16.48 lakh farmers. The process of waiving Rs 295.14 crore worth loans of 57,229 farmers was still under progress. Similarly, commercial banks have waived Rs 7,269.2 crore of 9.22 lakh farmers.

It can be recalled that the Congress-JD(S) coalition, under former Chief Minister H D Kumaraswamy, has estimated that around Rs 34,000 crore loan would be waived, a figure which shrank in subsequent days. Authorities had maintained that deduplication of documents would drag the figure down to around Rs 20,000 crore.

Wrong projections

Kodihalli Chandrashekar, president of Karnataka Rajya Raitha Sangha said that the government projections itself were wrong, as the government initially estimated that around Rs 40,000 crore would be waived.

Though Kumaraswamy has announced that all loans of farmers would be waived, it was subsequently changed to crop loans. “Government then imposed several conditions to filter applications. In some cases, the loan was not waived even after the government sent a beneficiary list to the banks - as banks insisted that loan would be waived only after the government deposited the amount,” he said.

Bogus accounts

Economist R S Deshpande said that government projections had to be revised as many bogus accounts of farmers were weeded out during document verification of CLWS.

Seeding Aadhaar and PAN number with bank accounts revealed that beneficiaries had multiple bank accounts through which they had availed loans. Since the waiver involved only one account, the total amount of waiver reduced, he added.