Maharashtra Cabinet Modifies Crop Loan Waiver Scheme, Benefits 13 Lakh Farmers

Maha cabinet clears modifications in crop loan waiver scheme, to benefit 13 lakh farmers

Mumbai, July 14

For nearly 13 lakh farmers covered under the 2019 scheme, the restrictive cap of Rs 50,000 has been abolished, extending complete loan waiver benefits up to Rs 2 lakh, said the government release. The strict condition requiring timely repayment for the fiscal year 2026-27 has been completely scrapped, instantly extending incentive benefits to an additional 23 lakh farmers.

Earlier, Fadnavis on the concluding day of the three-week monsoon session of the state legislature on Friday announced major modifications to the state's flagship Punyashlok Ahilyadevi Holkar Shetkari Karjmafi Yojna (2026). Yielding to demands from an all-party delegation of legislators, the state government has significantly relaxed initial restrictions to create what Fadnavis describes as the largest farm loan waiver in Maharashtra's history.

The two critical modifications announced in the State Assembly include removal of the Rs 50,000 cap for past beneficiaries and easing of the repayment regulation rule for the incentive plan.

Under the initial framework, farmers who had previously availed benefits under the 2019 Mahatma Jyotirao Phule Shetkari Karjmukti Yojana and subsequently fell back into debt were locked out of the full waiver. They were capped at receiving a maximum incentive of only Rs 50,000.

However, the government has completely scrapped this restrictive condition. Farmers who fell back into debt after the 2019 scheme are now eligible for the full Rs 2 lakh loan waiver, mirroring the benefits given to first-time applicants.

Fadnavis noted that while this shift would impose an additional fiscal burden of Rs 3,000 to Rs 5,000 crore on the state exchequer, the adjustment was essential to cover an estimated 13 lakh distressed farmers who would have otherwise been left out.

The scheme contained an incentive component providing a flat Rs 50,000 cash back to honest, regular borrowers who diligently service their crop loans. Originally, eligibility for this payout required proof of timely repayment extending through the 2026-27 fiscal cycle.

However, the rigid condition tied to 2026-27 repayments has been fully done away with. Instead, any farmer who successfully cleared and settled their crop loans in any two out of the previous three financial years will automatically qualify for the Rs 50,000 incentive.

— IANS