In a bid to facilitate fresh loans and provide debt relief up to Rs.1.5 lakh to each farmer, the State government has decided to set up Farmers’ Empowerment Corporation by providing an initial capital of Rs.7,000 crore.
After a meeting of top level executives of various banks with Chief Minister N. Chandrababu Naidu, Telugu Desam MP, Y. Satyanarayana Chowdhary, Principal Secretary (Finance) P.V. Ramesh and vice-chairman, State Planning Board, Kutumba Rao told reporters that the State Cabinet at its meeting on October 1 would approve the establishment of the corporation, which would be a “one-stop shop” for all welfare and empowerment activities of farmers.
They said the proposed corporation would repay banks the existing loans of farmers and ensure that the credit line remains open for them. However, the extent to which cash would be paid and certificates (such as bonds) with maturity value to be issued for covering the rest of the amount would be decided at the State-Level Bankers Committee meeting on Tuesday. The certificates with an annual 10 per cent interest would be bought by the corporation after January 15, 2016 if the farmers wanted to sell them.
Observing that it was not a waiver and the whole commitment of the government was aimed at providing debt relief to farmers, they said the initiative would cover 96 per cent of the farmers in the State. Other agriculture-related corporations such as seed development corporation, agro industries and oilseeds federation would also be merged with the new entity after their division was complete as per the A.P. Reorganisation Act.
