Farm Loan Waiver Drama in Karnataka
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Farm Loan Waiver Drama in Karnataka

Author: Thamanna Abdul Latheef calender  18 Jul 2018

Farm Loan Waiver Drama in Karnataka

Politics has become an interesting game when the politicians start theatrics to allure voters to gain power and continue to be in high offices of power. The unthoughtful promises, public statements and assertions including subsidies, farm loan waivers etc. have won them enough votes. But, India seems to be altogether on a different pace when it comes to implementing them. While farmers and common people constitute to the subject matter of concern and priority during elections, why do the same common men seem to have disappeared in the eyes of lawmakers post elections?

Recently the CM of Karnataka, HD Kumaraswamy, cried in public as he was referring to their commencement of farm waiver loan in the state and he justified his tears with a clichéd metaphor from Hindu mythology, likening himself to Lord Shiva who 'Swallowed poison'.

When the coalition government came into power in Karnataka, CM Kumaraswamy was in immense pressure to announce the waiver. In his recent state budget, he announced RS 34,000 crore loan waiver and after a while, much more pressure was on him to expand the scope of the package. Last week, he agreed to increase it to Rs. 44,700 crore. Logically, the state government wasn’t prepared to spend more than what was budgeted for the waiver in the first place.

In the past couple of years, many states including Maharashtra, Punjab and Uttar Pradesh have announced massive farm loan waivers. it is not just Karnataka that has announced a waiver of 44,700 crores. Many times, these farm loan waivers that the state governments provide don’t have the capability to wipe out the jeopardies and difficulties that persist in India's farm economy.

In order to address these issues, governments should announce loan waivers every year and ensure that the farmers are in safe hands. Unfortunately, governments can't afford due to various reasons. The same logic applies to the Minimum Support Price (MSP) that was announced very recently. The central government announced the increases but farmers under the banner of All India Kisan Sangharsh Coordination Committee (AIKSCC), are now preparing for nationwide agitations calling the increase inadequate and misleading.

The issue with both MSP and farm loan waiver is that they address only the symptoms and fail to cure the illness completely. While loan waivers fundamentally distort the credit culture of even honest borrowers and keep the farmer at the mercy of ruling parties for similar schemes, MSPs too have proven to be inadequate to address the sector’s structural problems.

These are mere political tools which save the faces of politicians till the time they govern. In spite of all the threats and notifications from RBI and other eminent economists regarding governments faulty approaches towards the farm sector in the country, the lawmakers continue to do the same to allure poor people for votes. The CM of Karnataka should ask himself whether this farm loan waiver would make farmers happy or wipe out all the troubles from their lives. Instead of emotionally bursting out in the public, the lawmakers and the representatives should start focusing on the works that they have to do without blaming other political parties for not doing it before during their tenure or for not supporting enough!

 

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