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Maharashtra is a path breaker, does not toe UP line on loan waiver

New Delhi: Maharashtra has given an  answer to those who are looking for  another option. other than Loan waiver,to help the  farmers and cause no harm to the financial growth of the state.

Instead of waiving loans the Government there has favoured  grant or subsidy to farmers to create durable assets which can improve their earnings in  future  and help the agriculture sector contribute more to the State’s Gross National Product .
Better earning can help both the government and the farmers. They can slowly clear the farm dues and government can gainfully employ the money saved this way to help others and improve the  financial health of the state.
 
It  will also help in maintaining financial discipline and end the vicious circle. Waiving off loans encourages them to  demand again even if they are not needed and press for waiver on the eve of elections. Thus a vicious circle  is created.
 
It is one state which has refused to toe Uttar Pradesh line. Farmers in several states in the country were making this demand after new government in Uttar |Pradesh decide to waive off farm loans. Besides farmers, the Maharashtra government was under pressure from its political partner, Shiv Sena, to do so. However, it  went for the next option available.
It is not that Uttar Pradesh has a good financial health but still it opted  for it  because it had used the waiver as a political tool and announced it  before the  recent assembly elections The government in the state has more than 30 per cent of the State GDP as loan whereas the the country’s average is 21 per cent.  The waiver involved more than eight per cent of its revenue.
 
Maharashtra, according to official reports available here, is much better off. The total debts of the government stands at Rs 3.54 lakh crores at present. This would have increased  by around Rs 35,000 crores after  the farm loan  waiver. 
 
The subsidy or grant which will be provided to farmers may be   used for creating  durable assets in fields of infrastructure and irrigation, particularly drip irrigation.
 
The Maharashtra government will entail a burden of about Rs 10,000 crores by providing grant or subsidy which is far less than what  it  would carry by waiving  farm loans.
Also read:Uttar Pradesh may open a floodgate for loan waiver demands

The post Maharashtra is a path breaker, does not toe UP line on loan waiver appeared first on Newstrack English.



This post first appeared on World Breaking News, please read the originial post: here

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