SC stays Madras HC directive to Tamil Nadu for blanket farm loan waiver
New Delhi: The Supreme Court on Monday stayed a ruling by the Madras high court directing the Tamil Nadu government to waive agricultural loans taken by all farmers, irrespective of their land holding, and to ensure that no penal action or loan recovery was initiated against them. The high court order was passed on a petition filed by P. Ayyakannu of the National South Indian River Interlinking Agriculturist Association on 4 April. Ayyakannu is leading the Tamil Nadu farmers’ protests in Delhi.
It was contended that a uniform scheme should be applied, irrespective of land holding, as all farmers have been severely affected due to drought.
According to a 28 June 2016 state government order, only marginal and small farmers are eligible for waiver of agricultural loans as declared by them when the loan was sanctioned. The bigger farmers are eligible only for partial debt relief.
Small farmers are those who have land holding between 2.5 and 5 acres and marginal farmers are those with land holding of less than 2.5 acres.
In May last year, former chief minister J. Jayalalithaa’s government waived the outstanding short-term crop loans, medium-term agriculture loans and long-term farm sector loans extended by cooperative institutions to small and marginal farmers, which cost the state exchequer Rs5,780 crore.
An additional 300,000 farmers were expected to benefit from the 2016 debt waiver scheme, apart from the around 1.7 million existing beneficiaries of the scheme, for which the state will have to shell out an additional Rs1,980.33 crore.