In a statement here, Badal said the decision not to include the farming community in the ambit of the Centre’s scheme which seeks to provide ex-gratia payment of the difference between compound interest and simple interest to borrowers for six months proved that policy makers were totally “out of sync with grassroot realities”.
“It is a sad day for Indian democracy if policy makers have become so out of touch with the agriculture sector that they do not realise that farmers bore the brunt of the COVID-19 pandemic.
Thousands of tonnes of fruits and vegetables simply rotted in the fields. Farmers who had made investments in poly and net houses suffered huge losses as their produce could not be marketed for months. Everyone associated with agriculture and allied activities like dairy farming lost money. Even paddy growers in Punjab suffered huge losses as they had to pay double for labour,” Sukhbir said.
He said farmers were expecting a complete waiver of their crop loans and waiver of interest on tractor loans as well as loans taken for other allied activities.
“It is shocking that instead of doing this, the Union government is not even ready to save them from compound interest being charged from them due to default in instalments. The finance ministry has played a cruel joke on the ‘annadaata’ who put his life at risk to supply food to the nation during the pandemic,” he said.
Badal urged the prime minister to direct the ministry to come out with guidelines for banks which offer concrete relief to farmers who are unable to repay crop loans and pay interest on other loans, according to the statement.
He said farmers should not be discriminated against by issuing clarifications that agricultural loans will not be eligible for the interest on interest waiver announced by the Centre.
Badal said this announcement is being seen as a double whammy by the farming community which was still reeling from the “ill-effects” of the Centre’s agri-marketing laws which resulted in losses to maize and cotton farmers in Punjab and working to the detriment of farmers across the country.
The finance ministry has clarified that agriculture and allied activity loans are not eligible for the interest on interest waiver announced by the government last week.
The Reserve Bank had on Tuesday asked all lending institutions, including non-banking financial companies, to ensure that the scheme of waiver of interest on interest for loans up to Rs 2 crore for the six-month moratorium period is implemented by November 5, as decided by the government.
Last Friday, the government had announced the scheme for grant of ex-gratia payment of difference between compound interest and simple interest for six months to borrowers in specified loan accounts.