After the elections in the state, the Congress government in Hyderabad is struggling to fulfill its promises made during the Assembly elections. One of the major promises was a loan waiver scheme for around two lakh farmers, pledged to be implemented by Chief Minister A Revanth Reddy before August 15.
The cash-strapped government is now exploring ways to gather funds for the loan waiver scheme. One option being considered is a land regularization scheme that could bring in nearly Rs 10,000 crore. Another option is to borrow money from a proposed farmers corporation. The government needs around Rs 30,000 crore to Rs 35,000 crore to waive loans up to Rs 2 lakh taken by farmers from scheduled banks.
The LRS scheme has received around 25.70 lakh applications, with a significant portion coming from different areas like HMDA, GHMC, other municipal corporations, municipalities, urban development authorities, and gram panchayats. The challenge lies in finalizing the regularization fee, as residents in Hyderabad are willing to pay higher fees due to increased land values. The previous government had introduced the LRS scheme but halted it during election time.
The plan to establish a Farmers’ Corporation was also aimed at raising funds through borrowing, but modalities for running the corporation are still being prepared. Waiving loans and facilitating bank linkage for farmers to obtain fresh loans would help the corporation mobilize funds for the agriculture sector. The government is currently borrowing from the RBI to cover monthly expenses, including salaries, pensions, and interest on previous government loans.
Given the financial constraints, the government is not considering tax increases or burdening the people further. Instead, it is exploring alternative methods to secure additional funds.
