HDK’s parting gift: Debt relief for poor, small farmers

Private loans borrowed by poor, landless agricultural labourers and small farmers will be waived under a one-time relief measure, caretaker Chief Minister H D Kumaraswamy announced Wednesday.

The Karnataka Debt Relief Bill, which was passed by the legislature in February this year, has received President Ram Nath Kovind’s assent on July 16. A government order implementing the Act was issued on July 23, which was Kumaraswamy’s last executive decision as chief minister.

“Those who have borrowed loans from pawnbrokers and moneylenders have to submit details to assistant commissioners, who have been made debt relief officers, within 90 days,” Kumaraswamy told a news conference. “They will not have to repay the loan and become debt-free.”

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All types of borrowings, including hand loans, will be covered under the Act. “In the case of a hand loan, the debtors will have to produce proof that property papers or cheques had been pledged on the basis of which the lender has been harassing them,” Kumaraswamy said.

Under the Karnataka Debt Relief Act, 2018, a debtor means a landless agricultural labourer, a person belonging to the weaker section and a small farmer. A debtor should not hold more than 2 units (4 hectares) of land and have an annual income less than Rs 1.20 lakh.

“This is my gift to the poor and I’m happy that I could work for them even while vacating office,” Kumaraswamy said, adding that the Act was modelled after a similar law passed when D Devaraj Urs was the chief minister. The government regularly follow-up with Rashtrapati Bhavan to get the Bill cleared, he pointed out.

“When I went to villages, many people often asked me why the government hadn’t waived loans of the landless, but only of those with land,” Kumaraswamy said. “The interest-based lenders are sucking the blood of the poor. I request people to make use of this one-time relief measure.”

There is no cap on the amount of loan that will be waived under the Act, Kumaraswamy clarified.

“Any borrowed amount before the Act came into force, which is from July 23, will be waived. This can mean that the loan can be borrowed many years ago, too,” he said, asserting that there will not be any scope for misuse of the relief measure.

The Act will not cover liabilities in the form of rent, land revenue arrears, government taxes, wage dues and so on.