Only 50% of farmers benefited from loan waivers, says study

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Only 50% of farmers benefited from loan waivers, says study

  • Only about half of intended beneficiaries of farm loan waivers announced by nine States since 2014 have actually received debt write-offs, shows a study by SBI researchers.

Highlights of the study

  • Till March 2022, poorest implementation of farm loan waiver schemes in terms of proportion of eligible farmers who had received announced benefits was in Telangana (5%), Madhya Pradesh (12%), Jharkhand (13%), Punjab (24%), Karnataka (38%) and Uttar Pradesh (52%).
  • Farm loan waivers implemented by Chhattisgarh in 2018 and Maharashtra in 2020 were received by 100% and 91% of eligible farmers, respectively.
  • Similar waiver announced by Maharashtra in 2017 worth ₹34,000 crore for 67lakh farmers has been implemented for 68% of beneficiaries.
  • SBI study was based on outcomes of 10 farm loan write-offs worth about ₹2.53 lakh crore announced by nine States, starting with Andhra Pradesh and Telangana in 2014.
  • Reasons for low implementation rate of these loan waivers:
  • Rejection of farmers’ claims by State governments
  • Limited or low fiscal space to meet promises
  • Change in governments in subsequent years