It’ll take Rajasthan 2 years to repay waiver amount

NEW DELHI: The cash-strapped Rajasthan government started delivering on its poll promise and began rolling out a multi-crore rupee farm loan waiver on Thursday even as it struggles to get its economics right.
Saddled with its own electoral pledge and the financial burden of the previous BJP government’s loan waiver, the Congress government will take two financial years to make good the loss to cooperative banks that advanced the farm loans.

Deputy chief minister Sachin Pilot started the distribution of waiver certificates to farmers at Sirsi in Jaipur. While the farmers get the benefit, the Rajasthan State Cooperative Bank will have to wait till March 2021 to recover the amount, to be paid by the Ashok Gehlot government in two annual tranches.

“The state government would be bearing the expenditure of the loan waiver from its own funds. This would be done over the next two fiscals,” Rajasthan State Cooperative Bank managing director Vidyadhar Godara told ET. “Half the amount would be given in 2019-20 and the remaining would be given in 2020-21 financial year. The apex bank would get the entire amount by March 2021.”

The government will waive loans totalling Rs 9,513 cr. However, the total amount will exceed Rs 15,000 crore because it has to bear the burden of the waiver declared by the previous BJP government under Vasundhara Raje.

The state government was struggling till late Wednesday to work out the finances. After several meetings between the chief secretary, the cooperatives department and Rajasthan State Cooperative Bank officials, it was decided to start with Rs 1,668 crore.

Of this, about Rs 1,250 cr would be transferred to the Rajasthan State Cooperative Bank towards the loan waiver and Rs 418 cr would be given as grant-in-aid next month. Officials said the state would make a provision in the budget for the waiver and this would be transferred to the Rajasthan State Cooperative Bank.

The Rajasthan government had received flak from the BJP during the previous assembly session over the delay in implementing the loan waiver. A sense of urgency was added after the Modi government announced on February 1that it would give Rs 6,000 a year to farmer families that own up to 2 hectares.