Yogi government drops Kisan Rahat bond plans to fund Rs 36,000 crore farm waive

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Farmers debt waiver stops development of Uttar Pradesh

The Yogi Adityanath government in UP has dropped its plan of floating ‘Kisan Rahat’ bonds to raise funds for the Rs 36,000-crore farm waiver exercise after its formal proposal with three options for financing cut no ice with the Centre.

“We are not floating any bonds. Not even a rupee would be sought as loan from any financial institution. The state is paying off farm loans of Rs 36,000 crore entirely from its own pocket, as per our budget,” UP’s FM Rajesh Agarwal told ET.

That the UP government had submitted a proposal to the Centre in April came to light on Tuesday in a reply by the Union MoS for agriculture Parshottam Rupala to a question.

“The UP government in April requested the Union government for the need to arrange adequate resources separately to ensure implementation of the decision for agriculture debt waiver,” Rupala said, adding UP made “three requests”. Rupala said the first request was for grants-in-aid of Rs 36,529 crore to be provided to UP in 2017-18.

The second, he said, was if the first wasn’t possible, grants-in-aid to the extent possible be given and balance resources be allowed to be raised by bonds.

Third, that if the Centre was not in a position to provide grants-in aid, resources be allowed to be raised via bonds by the UP government and “the same may be permitted to be kept out of the annual borrowing ceiling fixed for UP in 2017-18”.  ET

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