Amaravati: The Jaganmohan Reddy government in Andhra Pradesh has cancelled the order issued by previous TDP government to waive off the loans of farmers worth Rs 7,959 crore under its farm loan waiver scheme.
The Naidu government had issued an order on March 10 to waive of the farm loans along with 10% interest rate for delaying the payment. The order was cancelled by Special Chief Secretary (Agriculture) Poonam Malakondaiah on Wednesday releasing this amount as the fourth and fifth instalments under the debt redemption scheme.
The Naidu government had assured to repay the loans in five installments and had paid three of them too before March 2019. However, the last two installments couldn’t be paid due to the Model Code of Conduct between from March to May.
The YSRCP after coming to power decided to give a financial aid of Rs 12,500 per annum through YSR Rythu Bharosa Scheme which is scheduled to be launched on October 15.
To implement the Rythu Bharosa scheme, the Jagan government cancelled the previous arrears payment orders given by the TDP government.
Ever since it assumed power, the YSRC government has maintained that the TDP regime only 'cheated' farmers by not fully implementing the debt redemption scheme in five years, and that its new 'Rythu Bharosa' envisaging input grants would give more benefit than the earlier scheme.
The Chandrababu Naidu government, upon assuming power in June 2014, had announced the debt redemption scheme in line with its electoral promise and offered to waive farm loans up to Rs 1.5 lakh per farmer.
It calculated the aggregate burden at Rs 24,500 crore. It told the banks that the amount would be paid in five instalments, plus the interest component.
The TDP government initially announced that it would sell red sanders, which is in huge demand in the international market and use the money for farmers debt redemption scheme.
The plan, however, flopped and the government had to pay from the treasury to to repay the banks.
In three years from 2015-16, the TDP government paid Rs 14,497.27 crore to banks for crop loans and another Rs 384.47 crore towards horticulture loans. That left a balance of Rs 10,003 crore to be repaid in the 2019-20 financial year.
A day before the schedule for general elections was issued, the Chandrababu Naidu government issued an order, releasing Rs 7,959.12 crore for payment of fourth and fifth instalments under the debt redemption scheme.
With the model code of conduct coming into force, the amount was not actually released to the banks. "Having itself failed to repay the debt in five years, how can the TDP ask us to carry its burden?" Finance Minister Buggana Rajendranath and Agriculture Minister K Kanna Babu asked.
"We don't want to cheat the farmers like Chandrababu. Hence we have decided to scrap all such fraudulent schemes. We will implement Rythu Bharosa in a foolproof manner from October 15 to financially empower the farmers," Kanna Babu said.
The new scheme would give more benefit to farmers than debt redemption, he added.