AP, Telangana growers in a tizzy over farm loans

As farmers in Andhra Pradesh and Telangana await waiver of their loans, they are now forced to rely upon private source for loans during the current kharif season.

Telangana Chief Minister K C Rao and Andhra Pradesh Chief Minister N Chandrababu Naidu had promised in their election manifestors to waive farm loans.

“As the

kharif season begins, banks have virtually shut the doors on us with confusion over the waiver refusing to die,” a leader of farmers’ union said.

“Banks are supposed to prepare a plan by May and begin disbursements of loans on May 15 and complete the process by June 30. Sometimes, it will go up to July 15. But the process has not started at all this year,” S Malla Reddy, national Vice-President of the All-India Kisan Sabha (AIKS) told

Business Line .

The banks reportedly are advising the farmers to pay at least part of the dues or interest to renew their loans and get eligibility for fresh loans. “But then, if you do that you will become ineligible for loan waiver programmes. So, farmers are in a precarious position,” he said.

Stance of banks

The problems faced by farmers on account of the loan-waiver have also been acknowledged by bankers at two state-level bankers committee meetings held in last ten days.

According to norms of the banks, a fresh loan cannot be given unless the existing loan/dues are cleared. As observed by CVR Rajendran, CMD of Andhra Bank and President of AP SLBC, “Unless a policy decision on the quantum and type of loans to be waived off is taken and informed to banks, fresh loans for kharif season cannot be given.”

Bankers had also expressed concern over the pressure the waiver puts on them in the way of preparation of list of eligible farmers for the waiver. “The loan waiver of 2008 had many loop-holes including benami beneficiaries which led to an investigation and bank staff were made scapegoats. We want the Government to take responsibility to prepare a correct list,’’ said a senior official of a State Bank of Hyderabad. All this would mean only further delay form a farmer’s perspective.

Confusion reins

While N Chandrababu Naidu, Chief Minister of Andhra Pradesh, appointed a committee to study the issue and advise the Government in 45 days, conflicting reports on the quantum of loan waiver in Telangana have left a lot of scope for speculation.

“The outstanding loans of farmers in Andhra Pradesh stand at ₹87,000 crore, with farmers East, West, Krishna and Guntur districts promised waiver of half the total dues,” Malla Reddy said.