Venkaiah Naidu

NEW DELHI: Union minister Venkaiah Naidu said on Thursday that waiving loans has now "become (a) fashion" and added that it's "not final solution".

"Loan waiver become fashion now, loan should be waived but in extreme situations only, it's not final solution... (but) have to take care of farmers," Naidu said according to ANI.

On Wednesday, Karnataka became the fourth state this year - after UP, Maharashtra and Punjab - to announce a waiver of farmers' loans . It announced a waiver of up to Rs 50,000 per farmer, which will cost the state exchequer Rs 8,165 crore.

On Monday, Punjab chief minister Amarinder Singh announced the waiver, one of his key poll promises, in the state assembly. He said the move would benefit 10.25 lakh farmers. Some 8.75 lakh farmers have farms of up to five acres.

The waiver in Punjab will cost the debt-ridden state Rs 24,000 crore, according to one estimate. Singh said his government has not decided on whether to take a fresh loan or generate more revenue to offset the waiving cost.

Last week, the BJP-led government in Maharashtra "in principle" agreed to a loan waiver for all sections of farmers, including big farmers who depend solely on agriculture. The criteria are expected to be fixed by a committee comprising state officials and agriculturists.

In April, Uttar Pradesh's Adityanath government also decided to waive loans of small and marginal farmers in the state; the waiver was a poll promise of his as well.



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