The
budget for 2008-09 was presented by Union Finance
Minister P Chidambaram on February 29, 2008. This
was his fifth consecutive budget and seventh in all.
Much of the Finance Minister's speech was devoted
to the agricultural sector.While
presenting the budget, the Finance Minister said,
"Having carefully weighed the pros and cons of
debt waiver and taking into account the resource position,
I place before the house a scheme of debt waiver and
debt relief for the farmers."
The
present budget has given primacy to agriculture, apart
from focusing on education and healthcare. He announced
Rs. 60,000 cr agricultural debt waiver/relief scheme,
which is the largest scheme announced in the India's
fiscal history. It is expected that the scheme will
benefit around 40 million farmers - 30 million small
and marginal farmers and 10 million other farmers.
Marginal farmers are those who hold land up to one
hectare and small farmers are those farmers who hold
land between one to two hectares. In fact, every small
and marginal farmer will enjoy an average loan waiver
of Rs. 16,667.
Under
the scheme, the unpaid amount of small and marginal
farmers will be completely waived while in the case
of other farmers, there is a One Time Scheme (OTS)
which consists of a rebate of 25% against payment
of 75% of the balance amount. The waiver scheme is
applicable for those loans disbursed by the commercial
banks, Regional Rural Banks (RRBs) and cooperative
banks till March 31, 2007 and overdue as on December
31, 2007 and which remained unpaid until February
29, 2008. Such agricultural loans which were rescheduled
and restructured during 2004-06 as per the Reserve
Bank of India (RBI) guidelines are also eligible for
a waiver or OTS on the same pattern. These banks have
to complete waiver process by June 30, 2008. The minister
said that after the debt waiver or signing an agreement
for payment of 75% amount under OTS, the farmer will
be eligible for fresh loans. |
