NITI Aayog Vice Chairman Rajiv Kumar on Wednesday said farm loan waivers are just a palliative and not a long-term solution for the farming community.
On the sidelines of release of NITI Aayog’s “New India – 2022” strategic document, the NITI Aayog vice chairman was reacting over Congress chief Rahul Gandhi’s demand for loan waivers for farmers,
Kumar, however, said short-term measures might be required in some States confronting real farm distress. “The Centre does not take a pan-India view on the issue as it would not be fair for farmers in states where the loan exposure is very less.”
“Farm loan waiver is not a solution. It’s just a palliative. This is a state government prerogative whether they want to give the farm loan waivers, as agriculture is a state subject,” Kumar said.
“The states have to look into their own fiscal resources and go ahead with what they want to do. In states, where there is a genuine and real farm distress, some short-term measures would have to be taken. This is in that nature, it’s not a long- term solution for the farmers’ problem or for agricultural modernisation,” he said.
As for the liquidity concerns in the economy and the possibility of rate cut by the Reserve Bank of India, Kumar said the current inflation figures, which are well below the target of four percent, itself call for a rate cut to support liquidity and growth in the economy.
On GST, Kumar said: “About 97 percent of the items are already at or below 18 per cent GST and as the taxbase widens and there is a revenue buoyancy, 99 per cent of items can come below 18 per cent tax, leaving only the non-merit items like cigarettes and alcohol in the above 18 per cent category.”