The Union government is considering a proposal to waive the interest on crop loans if the farmers make timely repayments on them, reports the Press Trust of India (PTI).
This proposal, if approved, would increase public expenditure to the tune of Rs 15,000 crore. Along with interest waiver on crop loans, the government is also looking to entirely waiving off premiums on crop insurance for food crops and reducing the premiums on horticulture crops.
Currently, farmers can avail short-term crop loans from government banks at a seven per cent interest rate. However, an additional subsidy of three per cent is given for prompt repayment of loans.
Under the Pradhan Mantri Fasal Bima Yojana, launched by PM Modi in 2016, a uniform premium of two per cent is to be paid on crop insurance for all Kharif crops and 1.5 per cent for all Rabi crops.
In the case of annual commercial and horticultural crops, five per cent premium is charged by the insurance companies.
The proposals to waive off interest and premiums to relieve the stress in the farm sector could be part of the government’s Rs 60,000-70,000 crores financial package to provide income support to farmers.
Also Read: Odisha’s Farm Sector In Deep Distress, Farmers Fight Back
Comments ↓
An Appeal...
Dear Reader,
As you are no doubt aware, Swarajya is a media product that is directly dependent on support from its readers in the form of subscriptions. We do not have the muscle and backing of a large media conglomerate nor are we playing for the large advertisement sweep-stake.
Our business model is you and your subscription. And in challenging times like these, we need your support now more than ever.
We deliver over 10 - 15 high quality articles with expert insights and views. From 7AM in the morning to 10PM late night we operate to ensure you, the reader, get to see what is just right.
Becoming a Patron or a subscriber for as little as Rs 1200/year is the best way you can support our efforts.