AP Farmers in Debt Trap after Reschedule of Loans

In a latest development, the AP Government has advised the farmers to reschedule their loans through paying the loan amount pending with the Banks after the implementation of first phase of crop and gold loan waiver scheme. The Chief Minister himself told the farmers to pay the residuary loan amount and get the rescheduled loans from banks.

It is proposed to the banks to issue loans at 4 percent interest after rescheduling of existing loans. The AP Government has promised the farmers on issuing bonds with 10 percent interest payment on their loans to the Banks. The Government has suggested that the farmers will be benefited with 6 percent interest margin on rescheduled loans and interest on bonds.

But there is so much air on the statements made by Chief Minister. There is no clarity on the loan waiver for women self help groups till the date. The much publicised crop and gold loan waiver has been exasperated with 20 percent waiver to 25 lakhs farmers.

Another important thing is that the proposed reschedule loans are to be borne by the farmers. It will be considered as a new loan by the Banks and the farmer will be in debt trap even after the total runa maafi by the Government through loan waiver scheme. Moreover, the gold loans have not been waived for lakhs of farmers after the introduction of SoF clause. The confusion is likely to continue till the next elections in 2019.

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