Kumaraswamy announces Rs 34,000 crore loan waiver in maiden budget

Written by July 5, 2018 13:55

Bengaluru: In his maiden budget, Karnataka Chief Minister HD Kumaraswamy on Thursday announced a mega farm-loan waiver worth Rs 34,000 crore. The loan waiver is reportedly meant for the small and marginal farmers, who have been financially hit by four years of drought over the past five years.

Kumaraswamy announces Rs 34,000 cr loan waiver

Unveiling the budget proposals in the Assembly, Mr Kumaraswamy said he has limited the loan amount to 2 lakh rupees, as it was “not right” to waiver higher value crop loan.

To mobilise resources, Mr Kumaraswamy has proposed in the budget to increase tax on petrol from 19 to 21 percent, Additional Excise duty on IML by 4 percent, tax on electricity from 6 to 9 percent and Motor Vehicles tax by 50 percent on private service vehicles.

Besides this, it has been decided to credit the repaid loan amount or 25,000 rupees, whichever is less, to each of the farmers account, to help farmers who had repaid the loan within time.

Kumaraswamy is confident he will stay in power without problem till lok sabha electionsThe families of the government officials and officials of the cooperative sector, farmers who have paid income-tax for the past three years and other ineligible farm loan recipients will be outside the purview of the loan waiver scheme.

Excerpts from his Budget speech:

# To facilitate farmers to avail new loans, action will be taken by the government to issue clearance certificate by waiving the arrears form the defaulting account. For this purpose, Rs 6,500 crore is earmarked in the 2018-19 budget.

# I have decided to limit the loan amount to Rs 2 lakh per farmer. Due to this crop loan wiaver scheme, farmers will get the benefit of Rs 34,000 crore. I have decided to waive all defaulted crop loans of farmers up to 31 Dec 2017 in the first stage. Farmers who repaid the loan within time, as an encouragement to the non defaulting farmers, I have decided to credit the repaid loan amount or Rs 25000 whichever is less.

Petrol, diesel prices hiked

# I propose to increase the rate of tax on petrol from the present 30% to 32% and diesel from 19% to 21%, so petrol price will be increased by Rs.1.14/ltr and diesel by Rs 1.12/litre.

BJP critical of Kumaraswamy’s budget proposals

BJP has criticised the budget by saying that imposition of conditions on farmers loan waiver will deprive many farmers from availing the facility. The imposition of fresh taxes has also come in for criticism. The BJP leaders also pointed out that budget allocations are more for Ramanagara, Mandya and Hassan which are considered as JD(S) stongholds. Most of the programmes of previous Congress Government have found support in this budget.