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Chandigarh, July 6 (PTI) Haryana today demanded a threefold increase in the ceiling of the Centre''s debt swap scheme under which farmers can exchange their expensive loans from moneylenders with cheaper bank loans. At a meeting of the Northern chief ministers with Finance Minister Pranab Mukherjee here today, Haryana Chief Minister Bhupinder Singh Hooda further said farm tenants must be allowed to take agricultural loans, besides extending the Centre''s interest subsidy scheme even to the loanees of long-term cooperative credit societies. The chief minister also demanded that banks should lower interest rates for loans extended to the BPL families in the self-help groups. Hooda said the upper limit of loan under the debt swap scheme should be hiked from the present Rs 50,000 to Rs 2 lakh, as the maximum amount of loan disbursed under the scheme is quite inadequate to make any significant impact on the indebtedness of the harried farmers. "Only Rs 50,000 is being given under this scheme now which is on the lower side. For a prosperous state like Haryana, farmers had to take a loan of Rs 2-3 lakh from local non-institutional sources to meet any major farming or non-farming need," he said. Under the debt swap scheme, farmers can repay debts to moneylenders by taking loans from banks up to Rs 50,000. Underscoring the need for making tenants and sharecroppers eligible for taking farm loans, Hooda said the rural financial institutions (RFIs) must not concentrate only on large borrowers to bring down cost. "Small borrowers are in fact more important than large borrowers. There is inter-regional difference in the reach of RFIs. Their reach should be in every nook and corner of the state so that people in every area can benefit from credit lending," he said. Spelling out the reasons behind farmers trapped under debts, Hooda said banks either do not supply the full amount of loans required by farmers or paper work is too cumbersome. Hooda also asked commercial banks to take the value of farm land at floor rates fixed by the government for the purpose of collateral, as is being done by cooperative banks. Asking Mukherjee to provide interest subvention to those farmers who have taken loans from long-term cooperative credit societies, Hooda said his government is providing interest subsidy of 5 percent against 2 percent provided by the Centre. He also suggested that the rate charged by banks from BPL families in self-help groups should not be above 7 percent, which is normally charged by banks for farm advances. At present, banks are charging interest ranging from 9 to 12 percent from BPL families PTI CHS DKS BSP IND.
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