Mar 16, 2008

FM says majority of debt waiver will be to small and marginal farmers

Finance Minister (FM) P Chidambaram today said in Parliament that small and marginal farmers would be given debt relief of Rs 50,524 crore and Rs 9,790-crore would be for one-time settlement of other farm loans. FM had announced a massive Rs 60000-crore debt waiver package to farmers in Union Budget 2008-09 announced on 29 February 2008.

Out of the total debt waiver, scheduled commercial banks would get 35% and co-operatives would get 55% share, FM said.

The outlay for the waiver would be spread over 36 months, Chidambaram said, adding the government has already allocated Rs 10,000-crore via supplementary grant in the current year. The government is planning to complete waiver of Rs 40000 crore over just 14 months, Chidambaram said.

He said the government would in July 2008 release Rs 25000 crore in cash to banks to fund the farm debt waiver scheme. Another Rs 15000 crore will be released by August 2009 for the scheme, he said.