Fri. Mar 29th, 2024
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Addressing the media on the release of ‘Strategy for New India@75’, the top officials of Government’s think tank, NITI Aayog expressed strong disagreement over the idea of farm loan waiver carried out by various states in a row.

At the event, NITI Aayog Vice-Chairman Rajiv Kumar stated that farm loan waiver is “not a solution” to the growing agrarian distress. Rajiv Kumar called it “only a palliative”.

Another member of NITI Aayog, Ramesh Chand added that farm loan waiver is “not the right policy”. He claimed that it “does not reach the right people” citing that since the scheme only covers farmers and not cultivators, it will only benefit less than 40 percent of the needy. He added that small and marginal farmers will not be benefitted by the scheme.

Chand also commented that the loan waiver in Madhya Pradesh will only benefit less than  25 percent farmers.

He poured praises on the previous government which provided interest-free loans to the farmers if they repaid the loans on time. He said that this policy brought discipline, which he feared, now would be affected.

He suggested that instead of waiving the farm-loans, the governments should focus on ensuring that the benefit of Minimum Support Price(MSP) reaches the farmers.

Chand also pointed out that the last nationwide loan waiver in 2008-09 came with many caveats as a result of which it could not benefit many. Also, he cited that it cost the exchequer more than Rs 50,000 crore.

Addressing Agrarian Crisis

NITI Aayog suggested setting up of a National Agricultural Tribunal to replace the existing Commission on Agricultural Costs and Prices (CACP).

It also pitched for the replaced of Minimum Support Price (MSP) by a Minimum Reserve Price (MRP) which would serve as the starting point for auctions at the mandis.

The Aayog called for a long-term solution by creating a competitive, stable and unified national market which would not only ensure better price discovery for the farmers but also serve as a long-term trade regime favorable to exports.

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