Q. The State Bank of India’s chairman Arundhati Bhattacharya had said that farm loan waiver disrupts “credit discipline” among borrowers. According to SBI’s research report, total outstanding credit for the agriculture sector as of 2016 in Uttar Pradesh is:
A. Rs 1.34 lakh crore
B. Rs 86,241.20 crore
C. Rs 27,419.70 crore
D. Rs 76,063.20 crore
State Bank of India in its research report (2016) said that schedule commercial banks together had a total outstanding credit for the agriculture sector are Rs 86,241.20 crore in the state with an average ticket size of Rs 1.34 lakh.
According to a recent news report, newly elected Uttar Pradesh government is proposing a farm loan waiver scheme worth Rs 27,419.70 crore.
Concerning this, SBI chairman Arundhati Bhattacharya had said that farm loan waiver disrupts “credit discipline” among borrowers as they expect future loans to be waived as well.
The Reserve Bank of India has also raised concerns over farm loan waiver.
Though finance minister Arun Jaitley, in a parliamentary debate, ruled out farm loan waivers by the Centre, saying that states were free to utilize their own resources in this regard.
- ‘UP farm loan waiver: Banks will take 27,419-crore hit’, March 21, 2017, The Indian Express
- Who will pay for Modi’s farm loan waiver poll promise? Arun Jaitley says not Centre; all eyes on Yogi Adityanath, March 24, 2017, The Financial Express