Home News Reports Loans waived by Congress govt in MP, but here are the 'conditions apply' that farmers should see

Loans waived by Congress govt in MP, but here are the ‘conditions apply’ that farmers should see

While the Congress party seems to demonise the Modi government and drum up support for itself by indulging in farm loan waiver rhetoric, the reality of the situation seems to be very different for the farmers.

With Kamal Nath being sworn in as the Chief Minister of Madhya Pradesh, his first decision was reported to be to waive off farmer loans.

This is being widely hailed as a tall promise delivered by Rahul Gandhi, moments after his chosen man being sworn in as the Chief Minister.

However, the loan-waiver comes with terms and conditions that not too many farmers might be aware of.

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The following glaring problems are being ignored by most of the media when they hail the newly formed Congress government for living up to their promise.

Upper ceiling of loan waiver

The order that has been signed by Kamal Nath sanctioning the so-called farmer loan waiver in Madhya Pradesh mentions that the upper ceiling for the outstanding amount to be waived off is Rs. 2 lakhs. Which means that any farmer who has racked up a repayment amount of more than 2 lakhs gets hardly any benefit from the state at all.

Only the outstanding till 31 March 2018 to be waived off

The order signed by Kamal Nath says that only the outstanding amount till March 31st 2018 would be waived off by the state government. This poses another problem for several farmers. Congress and Rahul Gandhi’s rhetoric had suggested that all farmer loans would be waived off.

In the run-up to Madhya Pradesh Assembly Elections, last month it was reported that several farmers had stopped repaying their loans owing to Rahul Gandhi’s promise of full loan waiver to the farmers. Times of India had reported that loan repayment had dropped by 10% due to Rahul’s promise.

However, with the order stating a cut-off date going months back from the date promise was made, several farmers who had banked on Rahul Gandhi’s promise would be left high and dry.

Only short-term loans

The order clearly mentions that only short terms loans would be waived off. Short term loans to farmers are those which are given for seasonal crops and hence, loans such as those taken for digging wells, buying irrigation equipment, animals, etc. that usually come under medium to long-term loans, are not to be waived off.


The loan waiver sanction signed by Congress says that only those farmers who are “eligible” would be able to avail of the benefits. Other than the restrictions already mentioned, one has got to wonder if there are other surprises and restrictions in store that would effectively leave out many more farmers from the blanket promise that was made by Congress and Rahul Gandhi.

In the Assembly Election results of 11th December 2018, the incumbent BJP government in the state was defeated and Congress came to power. Loan waiver promise is supposed to have helped the Congress party, which kept repeating that the BJP government was a ‘suit boot ki sarkar’ and that only Congress would do what is needed to benefit the farmers.

Even during the Karnataka elections, Congress had promised full farmer loan waiver. After the Congress-JDS government came in power, for the longest time, the loans of farmers were not waived off.

When they were, it then emerged that it was mere lip-service by the coalition government. It emerged that the farmers were still getting recovery notices from banks for the loans they had availed. The government had also admitted that out of the Rs. 44,000 crore farmer loan waiver, only a paltry 800 farmers had benefited.

While the Congress party seems to demonise the Modi government and drum up support for itself by indulging in farm loan waiver rhetoric, the reality of the situation seems to be very different for the farmers.

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