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Court orders India's Tamil Nadu gov't to waive loans of farmers hit by drought

Xinhua, April 5, 2017 Adjust font size:

The top court in India's southern state of Tamil Nadu on Tuesday directed the local government to waive crop loans availed by farmers hit by drought.

The court directed loan waiver should be extended to farmers irrespective of their land holdings and restrained officials belonging to cooperative banks from initiating any penal or recovery proceedings against farmers who have defaulted on repayment of crop loans.

"We are aware that the financial situation of the state government is grim. The chief secretary in her letter to the advocate general also reiterated the same. The state government is already single handedly shouldering the burden and it will be additional burden," the Madras high court said.

"Consequently, we restrain the respondents from initiating action against the farmers for recovery of crop loans outstanding dues to cooperative societies or banks as on March 31, 2016."

The court's directive came days after the federal government sanctioned a drought-relief package of 222 million U.S. dollars from the National Disaster Response Fund (NDRF) to help state grappling with drought.

Earlier, the local government had announced loan waiver for farmers possessing less than five acres of land holdings.

Farmers from the drought hit Tamil Nadu have been staging a protest demonstration at Jantar Mantar in India's capital city New Delhi for more than three weeks seeking relief measures.

The protesters have been holding dead rats, snakes in their mouth and even tonsured their heads to highlight their plight. The protesting farmers have threatened to slit their throats if the federal government ignores their problems.

The high court verdict has come as a relief for additional 300,000 farmers in the state. However, crop loans from cooperative banks amount to just about 11 percent while the rest of them have been availed from nationalised banks.

Farmers in Tamil Nadu are reeling under severe stress due to two successive years of drought.

In January this year, the local government in Tamil Nadu declared all districts of the state drought-hit following a deficit in the northeast monsoon in 2016. Endit