At least 3.4 lakh farmers in Punjab are awaiting debt waiver benefits as the Punjab government faces a severe financial crunch following the Centre’s move to curtail the rural development fund (RDF). The Punjab government charges 3 per cent RDF on procurement of food grain from the state. The money is spent on for development of the rural sector. During the paddy procurement in the last kharif season, the Centre curtailed RDF to one per cent, and state got only Rs 400 crore as against an estimated Rs 1,200 crore.

As part of its flagship scheme, the Amarinder Singh government has waived off debts of 5.5 lakh farmers with an expenditure of Rs 4,600 crore. In the second phase, 55,000 farmers are waiting to get Rs 1,800 crore as waiver and 2.85 lakh landless farmers would get Rs 520 crore. A total of Rs. 2,320 crore remains to be disbursed.  The state government raised funds from banks and other financial institutions to fund the debt waiver.

“We used to pay back loans from the RDF regularly but now things, I am told, have gone awry. It is not clear how much funds are available with us and what’s the plan to manage them,” says cooperation minister Sukhjinder Singh. The Rural Development Board (RDB) headed by the chief minister as an ex-officio head controls usage of the RDF.

A delegation from the state, led by FM and comprising food minister Bharat Bhushan Ashu and PWD minister Vijayendra Singla, met Union food and PDS minister Piyush Goyal for release of three per cent RDF. “We have been given assurance (for release of 3% RDF) and I am sure on receiving the backlog, the state government would fulfil its commitment to the farmers,” said Ashu.

“We have done surveys and have even identified beneficiaries to be given the waiver, but waiting release of funds,” says an officer of state’s cooperation department, a nodal agency for disbursing waiver amounts, adding that state’s agriculture department that processes the debt waiver cases would be sent the figures.

As per the scheme, a debt of up to Rs 25,000 is waived of on landless farmers who had availed loans from primary agricultural cooperative societies (PACS), with a cut-off date of March 31, 2017, along with a rate of interest of 7% per annum. There are 3,300 PACS in the state out of which 1,692 have given debt to landless farmers. “The accounts were to be verified manually from every single PACS so it took time,” adds the officer.

After the roll-out for the debt waiver package , landless labourers were also demanding waiver, claiming equal stake in the state agrarian economy. In its pre-poll manifesto before 2017 state polls, the Congress had promised debt waiver for farmers but not to landless farmers. By an estimate, there are 15 lakh landless farmers and all of them are demanding waiver. However, the government said that owing to funds crunch it could waive off only the institutional loan.

In the watered down scheme, 5.5 lakh farmers so far have been given the waiver, out of a total of 15 lakh farmers in state. The waiver was launched in October 2017, seven months after the Congress government was formed.

During campaigning , the Congress had offered to waive of the entire loan on 15 lakh farmhands in the state but it was later restricted to marginal and small farmers who owns up to 2 hectares of agriculture land. The waiver was capped at Rs 2 lakh.

In the annual budget, finance minister Manpreet Singh Badal earmarked a sum of Rs 1,186 crore for debt waiver.

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