Maharashtra government to raise Rs 4,800-crore loan to pay farmers’ dues

Devendra Fadnavis, reviewing the status of the project affected people in irrigation projects expressed shock over the compensation pending since the big dam project of Ujjani way back in 1976.

Written by Shubhangi Khapre | Mumbai | Published:November 6, 2016 2:44 am
Maharashtra government, Maharashtra government farmers, Maharashtra farmers, farmer loan, farmer loan maharashtra, fadnavis, devendra fadnavis, latest news, latest india news Almost 30 lakh farmers whose land was acquired for irrigation projects are awaiting final settlement of compensation. Express

The Maharashtra government will raise Rs 4,800 crore loan to pay longstanding compensation to project-affected farmers, whose agricultural land was acquired for mega irrigation projects in the last four decades. The decision was taken as the state government owed Rs 4,800 crore to almost 25 to 30 lakh farmers in varying degrees spread over the last forty years. Failure of the government to pay compensation has led to an increase in interest rate on the original compensation amount, which works to Rs 400 crore per year.

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Chief Minister Devendra Fadnavis, reviewing the status of the project affected people (PAP) in irrigation projects expressed shock over the compensation pending since the big dam project of Ujjani way back in 1976.

Highly places sources in water resources ministry said, “The chief minister indicated that the government should mobilise the total amount of Rs 4,800 crore and make the entire payment to all the farmers across the districts in all irrigation projects.”

During the meeting, the chief minister pointed out that there cannot be any justification in keeping the dispute over compensation to farmers whose land was acquired for irrigation projects eternally on the backburner.

There are 3,037 dams whose works have been completed in the last six decades. The list of incomplete works including dams runs long with a fund requirement of up to Rs 80,000 crore.

Sources revealed, “Under section (11) of land acquisition, farmers were given compensation when the project was started. However, in majority of cases over the last forty years, it was noted that people, after taking part compensation, went to court seeking higher value for their land.” Since the matter was in dispute at various stages

under section 18, it mandates that till the full realisation of compensation the government had to pay the interest rate on the amount between 9 to 15 per cent. The amount the government owes to farmers in irrigation works, factoring the interest rates is Rs 4,800 crore. The chief minister indicated that it was pointless to shell out Rs 400 crore annually on interest and unfair to keep farmers’ dues for so long.

Therefore, he recommended to the ministry of finance and ministry of water resources to opt for borrowing funds at lower rates and making full and final payment which would work better for the government.

The official said, “At present, we can raise the entire amount of Rs 4,800 crore at an interest rate of seven percent. Whereas, keeping the issue unresolved means shelling out 9 to 15 per cent interest.” Officials also wondered why the decision was kept pending by the previous government for the last four decades.

Six months ago, Fadnavis decided to tackle problems of farmers waiting for compensation for dam projects built in 1970s, 80s and 90s. In June, he decided to reconstitute the project affected people’s relief and rehabilitation authority which had become defunct for the last six years during Congress-NCP regime.

The chief minister believes the decisions of the administration cannot overlook humanitarian side. Since early 1970s, several lakh project displaced persons’ land was acquired for big irrigation projects such as Koyna, Jayakwadi, Gosikhurd amongst others across Western Maharashtra, North Maharashtra, Marathwada, Vidarbha and Konkan regions.