The ‘interest-free or zero interest loan’ was recently the bone of contention between the ruling YSRCP and the Opposition TDP with both trading charges against each other and claiming to be championing the cause of farmers.
Notwithstanding the claims, it was found that the farmers had been paid a “pittance” in the last five years. The YSRCP government, which had taken over the reins from the TDP, made a token provision of ₹100 crore for the scheme in its 2019-20 budget.
Farmers availing of a crop loan of less than ₹1 lakh can avail themselves of the benefit under the scheme. The government will repay the interest component on the loan availed only if the farmers repay the principal amount within the stipulated one year.
The interest charged by the banks works out to be 7%, which the Central (3%) and State governments (4%) bear. As per statistics, farmers had availed a crop loan of ₹2.03 lakh crore in the last five years. Of this, the extent eligible for subsidy was ₹8,100 crore. But the government had actually paid just ₹60 crore.
This being the case, the farmers’ associations point out the lacunae and meagre allocations being made by the successive governments.
A.P. Rythu Sangham president Y. Kesava Rao said the farmers were deprived of the benefit under the scheme as the allocations were meagre.
‘Pressure from banks’
To make matters worse, the bankers were allegedly forcing the farmers to pay the interest amount too despite clearing the principal within the stipulated time.
The farmers, it was said, were being told that the interest portion would be credited back into their accounts soon after the government released the subsidy portion.
“For more than two years the farmers have not been get their dues,” Mr. Rao alleged. The State government, while introducing the YSR interest-free loan scheme, said it was aimed at decreasing the cost of credit to the farmers.
The TDP retorted saying the the scheme had been introduced by the Congress government when N. Kiran Kumar Reddy was the Chief Minister of the combined State vide GO 639 issued in April 2013. The TDP said it had continued the scheme and cleared all the dues from 2013-14 to 2015-16, after assessing them at the SLBC meeting in March 2016.
