No proposal for complete loan waiver for farmers: Sitharaman

New Delhi: There is no proposal of a complete loan waiver for farmers under consideration with the central government, Finance Minister Nirmala Sitharaman informed Parliament on Monday.

However, she said, the government has taken several measures to strengthen the economic conditions of the farmers, including timely and adequate credit through Kisan Credit Card (KCC), wherein crop loan up to Rs 3 lakh is provided at subsidised interest rates under the Modified Interest Subvention Scheme (MISS), with additional incentives for timely repayment.

Besides, the government has enhanced collateral free short-term agricultural loans, including loans for allied activities, from Rs 1.60 lakh to Rs 2.00 lakh and ensuring adequate flow of credit from the banking system to the priority sectors of the economy, including agriculture, under Priority Sector Lending guidelines issued by the Reserve Bank of India (RBI), she said in a reply to the Lok Sabha.

Additionally, the government has launched crop insurance and direct cash transfer to landholding farmers through Pradhan Mantri Kisan Samman Nidhi (PM-KISAN), etc.

Replying to another question, Sitharman said the exemption in respect of disability pension received by members of the armed forces, who are invalided out of service on account of a disability attributable to, or aggravated by military service, has existed since the framework under the Income-Tax Act, 1922, as provided vide Notification No. 878-F (Income Tax) dated March 21, 1922.

When the Income-tax Act, 1961, came into force, she said, the exemption continued through the repeal and savings provisions.

"With the enactment of the Income-tax Act, 2025, the earlier enactments pertaining to the Income-tax Act, 1922, and related savings provisions ceased to operate. Therefore, in the absence of an express provision in the new Act, the exemption would have lapsed," the minister said.

The present provision has been included to ensure the continuation of the same exemption that existed earlier, including its scope and conditions, she noted.

The finance minister emphasised that there is no discontinuation of the said tax exemption.

"On the contrary, the Finance Bill, 2026, proposes to explicitly provide for a specific exemption in respect of disability pensions under the Income-tax Act, 2025," she said.

As of January 31, 2026, the number of armed forces personnel retired from service with disability is 1,47,263, while the number of armed forces personnel receiving disability pension who have been invalided out is 89,598 persons, she said.

Since the provisions under the Income-tax Act, 2025, are intended to continue the pre-existing legal position rather than introduce a new levy or withdraw an existing exemption, the question of introducing a grandfathering clause does not arise, she added.

The medical fitness of serving personnel is carried out annually, she said, adding that the personnel detected with disease/deformity/injuries/medical conditions are placed in the Low Medical Classification and are also reviewed periodically depending on the service-specific orders.

This annual medical examination includes general physical and systemic examination, supported by a battery of tests, which differ based upon the role of the officer in their respective service, she said.

On detection of a condition, the service specialist opines on the medical condition, employment restriction and medical classification of the personnel, Sitharaman said.

The medical classification of a person is finalised by the Medical Board, constituted as per para 418 and 419 of Regulations for the Medical Services of the Armed Forces-2010 (revised version).

"Personnel in permanent medical classification, if found unfit for discharging of military duties, may be invalided out on medical grounds by an Invaliding Medical Board [Army Order 513/71, NO 7/14 & IAP 4303 (6th Edition)]. The Invaliding Medical Boards carry out assessment of impairment of such individuals in accordance with GMO-2023, and the entitlement of the impairment is decided by Service HQs as per ER-2023 and GMO 2023," she said.

The medical boards only define the medical condition and the various employability restrictions necessitated to ensure adequate recovery and prevent further deterioration of the condition, the minister added.

The promotion policies of the Armed Forces officers are dealt with respective MS Branch/ equivalent branches of other services, she noted.