Kishor Tiwari alleges scam brewing in Agri loans through NBFCs
Mumbai: Noted agrarian expert, Shiv Sena leader and Maharashtra government Farm panel chief Kishor Tiwari has raised strong objections to the union budget proposal of Finance Minister Nirmala Sitharaman to expand the National Bank for Agriculture and Rural Development (NABARD) refinance scheme to cover NBFCs and cooperatives sector bypassing Public Sector Undertaking Banks.
The FM in her union budget presented on February 1 has proposed for loan disbursement of up to Rs 15 Lakh Cr through Non-Banking Financial Corporations (NBFCs). Among many schemes, the minister has increased the limit of credit that can be granted to farmers to Rs 15 lakh Cr for the next financial year.
“This is another attempt to fuel present agrarian crisis in the India as role of NBFC and cooperative is more exploitive like private moneylender with RBI-NABARD protection. The new proposal will open Rs 15 Lakh Cr revival package in the name of the farmers to mostly NBFC and cooperatives which are already bankrupt and their agriculture and Self Help Groups (SHGs) lending is matter of larger discussions in parliament,” Tiwari said. The agricultural credit target for 2020-21 of Rs 15 lakh Cr giving to NBFC and cooperative is another scam, he alleged.
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“The 16 point action plan for agriculture in the budget 2020-21 is mere eyewash. The union budget did not provide any solution to address core issues related to cost, crop, credit and risk management,” Tiwari said, adding, “The agrarian sector is in crisis with farmers committing suicide. This is an outcome of wrong policies adopted in banking, import-export, development, infrastructure and environmental sectors.” Issues such as Minimum Support Price (MSP) for cotton and soybean, new crop loans, new technology, financial assistance for farm widows and higher education for their wards were not addressed in the budget, Tiwari said.
“This is hostile attempt to use NABARD provides funding for all agriculture related activities and for rural development by ignoring PSU banks which RBI regulated whereas NBFC are privately owned and controlled by corrupt politician hence this is an ill motivated move of the smart salesman Finance Minister to expand the existing partial credit guarantee scheme, first announced last year, to cover securities issued by NBFCs without having regulator, moreover in another hostile attempt FM also relaxed the eligibility of NBFCs for debt recovery under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 from Rs 500 Cr to Rs 100 Cr for asset size and from Rs 1 Cr to Rs 50 lakh for loan size this will wreak havoc,” Tiwari said.
The union budget for the year 2020-21 presented by Finance minister Nirmala Sitharaman claims to be a foresighted one. It is claimed to be beneficial for the tax payers and common man of the country. But it has failed to deliver substantially when it comes to the burning issue before the country that is the agrarian crisis.
The farm sector of the country is reeling under acute problems and the central government has tried to mitigate the problem by announcing various measures to help the farmers in distress.
