In 2016, then CM Siddaramaiah had issued specific instructions to KASCARD Banks to not recover loans from farmers in drought-hit areas.

news Agriculture Wednesday, January 22, 2020 - 18:44

Former Chief Minister Siddaramaiah on Wednesday lashed out at the BJP government for rolling back its earlier instructions given to the Karnataka State Cooperative Agriculture and Rural Development (KASCARD) Bank to not recover loans from farmers in 110 drought-hit taluks.

“Our government had notified the banks not to forcibly recover the loans from farmers in drought-hit areas. This has been revoked by BS Yediyurappa’s government by allowing banks to recover bad loans. By doing this, Yediyurappa and the government have betrayed our farmers,” Siddaramaiah said.

He also questioned the state government as to why the promised compensation for crop losses to flood-hit farmers have not been issued. “Farmers from 55 taluks of 15 districts have already lost their crop yield due to the floods. They are still waiting for the rightful compensation from the government. But instead, the government is gearing up to forcibly recover loans and has been treating them badly,” he said.

What the government order states

On December 27, 2019, Registrar of Cooperative Societies (RCS) issued a notification asking KASCARD Banks to begin the process of recovery of farm loans from 110 taluks in the state that were earlier declared drought-hit in 2016-17 fiscal year.

According to the government order issued, the RCS recalled the earlier order, where specific instructions were given by the then Chief Minister Siddaramaiah, to KASCARD Banks to not recover loans from farmers in drought-hit areas. The RCS also cited a clarification issued by the Finance Department earlier in December 2019, stating that the department concerned had not given any official communication regarding the Chief Minister’s instructions.

In its letter clarifying this, the Finance Department said, “The circular of October 10, 2016, issued by the Register of Co-operative Societies, had instructions given by the then Honourable Chief Minister with respect to recovery of loans due to the severe drought in that particular year. Finance Department has not given any concurrence for the same. The KSCARD Bank’s decision to not recover the loans, quoting the 2016 circular, is not a valid justification.”

The RCS’s order directs KASCARD Banks to begin the process of recovery of loans in these 110 taluks.