Lok Sabha Question No. 136 (UNSTARRED), answered on 2018-12-11
Subject: Report on Farm Loan Waiver
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: BHAVANA GAWALI (PATIL)

O.I.H

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA

## UNSTARRED QUESTION NO. 136

TO BE ANSWERED ON THE 11 TH  DECEMBER, 2018

## REPORT ON FARM LOAN WAIVER

## 136.   SHRIMATI  BHAVANA PUNDALIKRAO GAWALI  PATIL :

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंी be pleased to state:

- (a) whether  the  Government  has prepared any report regarding farmers loan waiver;
- (b) if so, the details thereof;
- (c) if not, the reasons therefor along with  the  modalities  of  farm  loan  waiver schemes;
- (d) the number of farmers who have committed  suicide  because  of  loans especially in Maharashtra;
- (e) the details thereof from the year 2001 till date;
- (f) the steps taken for taking care of the families of these farmers and for loan waiver; and
- (g) the details thereof?

## ANSWER

MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंालय म राय मंी (SHRI  PARSHOTTAM  RUPALA)

- (a): No, Madam.
- (b): Does not arise.
- (c):    The Union Government at present is not considering any loan waiver Scheme for farmers. Such waivers may impact the credit culture of a State by incentivising the defaulters even if they are in  a  position to  repay  the  loan  and  thus create/amplify  the moral  hazard by  discouraging those borrowers who have been regular in repaying their loans. Further, each waiver granted makes it even more difficult to reject any future similar demand.

(d) to (g): The National Crime Records Bureau (NCRB) under the Ministry of Home Affairs compiles and disseminates information on suicides, in its publication titled 'Accidental Deaths and Suicides in India' (ADSI). These Reports on suicides are available upto 2015 on its website. This data is available year-wise & State-wise. The Reports for the year 2016 onwards have not been published yet.

As per Report of 2015, 'Bankruptcy or Indebtedness' and 'Farming Related Issues' are reported  as  major  causes  of  suicides  among  farmers/cultivators.  Other  prominent  causes  of farmers/cultivators suicides are family problems, illness, etc.   As per the ADSI Reports for the year 2015 and provisional data as provided by NCRB for  the year 2016, the details of number of  suicides  committed  under  Sub  Head  Self  Employed  (Farming/Agriculture)  in  Maharashtra from 2001 onwards is at Annexure.

To reduce the debt burden of farmers and to increase availability of institutional credit to farmers, following major initiatives have been taken by the Union Government:

-  With  a  view  to  ensuring  availability  of  agriculture  credit  at  a  reduced  interest  rate  to farmers,  the  Government  is  implementing  the  Interest  Subvention  Scheme  (ISS)  since 2006-07. Under ISS, the Government is providing interest subvention to make available short-term crop loans upto Rs.3 lakh for a period of one year at an effective interest rate of 4% per annum against the normal lending rate of 9% to prompt payee farmers.  Thus, the  prompt  payee  farmers  are  getting  an  interest  subvention  of  5%  per  annum.  The scheme is continued in 2018-19.  Besides, some State Governments in fact also provide additional interest subvention, reducing the effective interest burden on short term crop loans to zero.
-  Government sets annual target for the flow of credit to the agriculture sector. Banks have been consistently surpassing the annual target. The current year's agriculture credit flow target has been set at Rs.11 lakh  crore.
-  Reserve Bank of India (RBI) has issued Priority Sector Lending Guidelines (PSL), which mandate all Domestic Scheduled Commercial Banks to earmark 18% of their Adjusted Net  Bank  Credit  (ANBC)  or  Credit  Equivalent  amount  of  Off-Balance  Sheet  Exposure (OBE),  whichever  is  higher,  as  on  the  corresponding  date  of  the  previous  year,  for lending to Agriculture.
-  As per PSL guidelines loans to distressed farmers to repay non-institutional lenders are eligible under priority sector. Besides loans to stressed persons (other than farmers) not exceeding Rs.1,00,000/- per borrower to repay their debt to non-institutional lender are also eligible for the purpose of priority sector lending by banks.
-  In order to ensure that all eligible farmers are provided with hassle-free and timely credit for  their  agricultural  operations,  the  Government  has  introduced  the  Kisan  Credit  Card (KCC) Scheme, which enables them to draw cash to purchase agricultural inputs such as seeds, fertilizers, pesticides as well as meet other agricultural and consumption needs. The KCC Scheme has since been simplified by providing the farmers with ATM enabled debit card based on one-time documentation and built-in cost escalation in the limit, etc.
-  To  bring  small,  marginal,  tenant  farmers,  oral  lessees,  etc.  into  the  fold  of  institutional credit, Joint Liability Groups (JLGs) have been promoted by banks. The Government also promotes  formation  of  Farmer  Producer  Organisations  (FPOs)  in  a  big  way  to  enable farmers  to  leverage  economies  of  scale,  not  only  for  agricultural  inputs  but  also  for enhanced marketing opportunities.
-  Banks have been advised by RBI to waive margin/security requirements of agricultural loans upto Rs.1,00,000/-, vide RBI's circular dated 18 th June, 2010.
-  RBI  has  issued    directions  for  Relief  Measures  to  be  provided  by  respective  lending institutions in areas affected by natural calamities which, inter alia, include, restructuring/rescheduling of existing crop loans and term loans, extending fresh loans, relaxed  security  and  margin  norms,  moratorium,  etc.  These  directions  have  been  so designed that the moment calamity is declared by the concerned District Authorities they are automatically set in motion without any intervention, thus saving precious time. The benchmark for initiating relief measures by banks has also been reduced to 33% crop loss in line with the National Disaster Management Framework.

## ANNEXURE

Statement in respect of Part (d) to (g) of Lok Sabha Unstarred Question No. 136 regarding Report on Farm Loan Waiver due for answer on 11.12.2018 by Shrimati Bhavana Pundalik Rao Gawali Patil.

## Number of Suicides under Subhead Self Employed (Farming/Agriculture) in Maharashtra

| Year              |   Number of Suicides (Farming/Agriculture) |
|-------------------|--------------------------------------------|
| 2001              |                                       3536 |
| 2002              |                                       3695 |
| 2003              |                                       3836 |
| 2004              |                                       4147 |
| 2005              |                                       3926 |
| 2006              |                                       4453 |
| 2007              |                                       4238 |
| 2008              |                                       3802 |
| 2009              |                                       2872 |
| 2010              |                                       3141 |
| 2011              |                                       3337 |
| 2012              |                                       3786 |
| 2013              |                                       3146 |
| 2014              |                                       4004 |
| 2015              |                                       4291 |
| 2016(provisional) |                                       3661 |

(Source: Report on Áccidental Deaths and Suicide in India' for relevant years National Crime Record Bureau, Ministry of Home Affairs)

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