People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 10

March 10, 2013


Probe Irregularities in Farm Loan Waiver Scheme: AIKS, AIAWU


The AIKS and AIAWU have issued the following statement on March 7.


THE All India Kisan Sabha (AIKS) and the All India Agricultural Workers’ Union (AIAWU), notes that the Comptroller and Auditor General (CAG) has, in its report tabled in parliament on March 5, 2013, totally exposed the scam involved in UPA government’s Rs 52,000 crore farm loan waiver scheme about which the prime minister and other ruling party leaders have been talking loudly since the inception of the scheme in 2008.


It has become clear from the CAG report that a large number of beneficiaries, the small and marginal farmers, for whom the farm loan waiver scheme was meant, were prevented from receiving the loan due to fraudulent and faulty implementation of the scheme, as a result of which 1,257(13.46 per cent) were eligible but not considered by the lending institutions while in 8.5 per cent cases the beneficiaries of the scheme were neither eligible for debt waiver nor relief. Also the violation of guidelines ensured reimbursements of nearly Rs 500 crores were paid to different cooperative and private institutions.  A number of these were from Maharashtra, Andhra Pradesh, Karnataka and Kerala where farmer suicides had peaked in 2008.


The report states that no records were maintained of farmers applications that were accepted or rejected by lending institutions or of how many farmers were given fresh loans as a result of debt waiver and relief. It appears that there was evidence of tampering with, overwriting and alteration of records as well as false bank claims for charges, such as interest in excess of the principal amount, penal interest, legal charges, inspection and miscellaneous charges, which should have been borne by the banks themselves, including private scheduled commercial banks, micro finance institutions and even to the Reserve Bank of India without proper monitoring. The latter and NABARD had relied on dates of lending by institutions without checking the security of claims by banks and cooperative societies.


The All India Kisan Sabha (AIKS) and All India Agricultural Workers’ Union (AIAWU) are firmly of the opinion that the CAG report contains severe indictments of the UPA government’s implementation of the loan waiver scheme as a result of which many ineligible farmers were favoured and a large number of deserving small and marginal farmers were left out. There is no doubt, a scam involving hundreds of crores of rupees has been unearthed by the CAG.

The AIKS and AIAWU demand a thorough probe by an independent authority at the earliest possible time and all those involved in siphoning off the money through deception should be held guilty and face action.


We call on all our state units to check out on the implementation of the scheme and ensure that money meant for poor and marginal farmers is not misappropriated.  Both propaganda and actions on this issue should be launched until the truth is out, justice is done and the guilty are punished.