Farm Loan Waiver Is Populist Idea With Little Logic

Photo: Courtesy The Financial Express

The farm loan waiver by various states has turned into an “epidemic” of sort and would have repercussions for the national economy, Deccan Herald has opined in its editorial.

The “benevolent” gesture by state after state is a populist political idea with little logic behind it, the paper has argued and said the problem in the farm sector are “structural” and needs to be addressed by way of providing better irrigation facilities, better infrastructure for storage etc, not by waiving farm loans.

If that were to be the case, then UPA government’s mega loan waiver in 2008 would have ended all miseries, which did not happen, it underscored. Electoral plans and promises should not be the sole determinants of state policy.

It said the loan waiver, in a way, was helping only 15 per cent of the farmers as the rest of them avail loans from money lenders.