BJP Seeks To Build Pro-poor Image With Farm Loan Waiver

Round the clock power and ‘Annpoorna Canteen’ schemes to provide full meal for just ₹5 and breakfast for ₹3 are yet  another initiatives of the new UP chief minister to woo the general public and shed the pro-capitalist tag.

- Mudit Mathur

After establishing brand “Modi”, the time has come for Prime Minister Narendra Modi to wash away his pro-capitalist image by going for pro-poor and populist farm loan waiver, round the clock power and launching “Annpoorna Canteen” schemes in Uttar Pradesh to provide full meal for just ₹ 5.00 and breakfast for ₹ 3.00. Other BJP ruled or supported state governments could now come under pressure for a similar waiver.Similar demands are likely to come from the states like Maharashtra, Madhya Pradesh, Karnataka and Andhra Pradesh where farmers are worst affected by frequent droughts and natural calamities.

The cash-strapped UP government has decided to float “Farmer Relief Bonds” in coming budget session of state assembly, to generate funds to implement the loan waiver scheme as the limit for fiscal deficit cannot be higher than 3 per cent of the state’s GDP as set by the FRBM Act 2003. RBI governor Urjit Patel is of the opinion that farm loan waivers erode loan discipline and encourage willful default by farmers. Those who repay loans look like fools, and those that renege on loans are rewarded handsomely. This political encouragement of “don’t pay, and nothing will happen to you” is also affecting loans of non-bank financiers of autos, homes, durables and microfinance.