The Ashok Gehlot government in Rajasthan has put forward a proposal to establish a commission for streamlining the process of waiving farm loans. The government plans to introduce a special bill during the final Assembly session scheduled for August 2 to bar banks and other financial institutions from seizing and auctioning farmlands of those unable to repay their loans on time.
The Gehlot government initiated a waiver of Rs 14,000 crore for over 20.56 lakh farmers who had taken loans from cooperative banks. Despite repeated pleas from the Congress to the Centre to urgently take action on waiving loans from nationalised, commercial and land development banks, the latter has refused to comply.
It is important to note that while nationalised banks fall under the jurisdiction of the Central government, cooperative banks operate under the state government. The proposed commission will act as a safeguard, preventing banks and financial institutions from pressuring farmers to repay loans in cases of crop failure. Under such circumstances, farmers will have the option to apply to this commission for loan waivers.
The State Farmers’ Debt Relief Commission will consist of five members, with a retired High Court judge serving as the chairman. Upon declaring an area as distressed, the Commission will prohibit banks from taking any actions to recover loans, including selling, confiscating, or auctioning farmers’ properties. This move aims to alleviate the burden on farmers during times of financial hardship and provide them with much-needed support to sustain their livelihoods.