Agricultural Debt Waiver and Debt Relief Scheme

Agricultural Debt Waiver and Debt Relief Scheme (ADWDRS) have been launched by the Government of India to help the farmers financially by providing agricultural loans. Under this welfare scheme, ‘Direct Agricultural Loans’ comprising short term Production Loans for agricultural and allied activities. In this article, we look at the Agricultural Debt Waiver and Debt Relief Scheme in detail.

Types of Loan

Farmers can avail for any of these two loans under this welfare scheme that are explained below:

Short Term Production Loan

These are the loans that are offered with the raising of crops and were to be repaid within 18 months. This includes working capital loan exceeding Rs. 1 lakh for traditional and for non-traditional plantations and horticulture.

Investment Loans

These loans are comprised of investment credit for both direct agricultural activities and allied activities.
The credit of farmer extended for meeting outlays relating to the replacement and maintenance of wasting assets and for the capital investment designed to increase the output from the land. These loans are disbursed to farmers through Scheduled Commercial banks and Cooperative Credit Institutions. Loans granted directly to groups of individual farmers. Direct Agricultural Loans given under Kisan Credit Cards were also eligible for this debt waiver/debt relief scheme.

Eligibility Criteria

Framers those who opt either for Short Term Production Loan nor Investment Loans are eligible under this scheme and are categorised as per the parameters: Framers those who have taken Short Term Production Loan

S.No.	Framer	Activities
1.	Marginal Farmer	A farmer cultivating agricultural land up to 1 hectare (i.e. 2.5 acres)
2.	Small Farmer	A farmer cultivating agricultural land more than 1 hectare but up to 2 hectares (more than 5 acres)
3.	Other Framer	A farmer cultivating agricultural land more than 2 hectares (more than 5 acres)

Framers those who have taken Investment Loans for allied activities Under this loan, the farmers are categorised based on the amount of the loan obtained for the allied activities.

S.No.	Framer	Activities
1.	Marginal Farmer	A farmer obtaining a loan up to Rs. 50,000
2.	Small Farmer	A farmer obtaining a loan up to Rs. 50,000
3.	Other Framer	A farmer obtaining loan amount for above Rs. 50,000

Benefits of Debt Waiver and Debt Relief

Debt Waiver is signified 100% waiver of the eligible amount whereas the Debt Relief is signified 25% waiver of the eligible amount under the One-Time Settlement (OTS) scheme. Debt Waiver and Debt Relief were to be applied as follows:

Marginal/Small Farmer: The whole of the eligible amount was to be waived.
Other Framer: The farmer would be given a rebate of 25% of the eligible amount subject to the conditions that the farmer has to pay the remaining 75% of the eligible amount. Other farmers would gain the rebate of Rs. 20,000 or 25% of the eligible amount whichever is higher. This can be calmed by the leading institutions from the Government of India after the receipt of a balance of 75% of the eligible amount from the farmer willing to avail the benefit under the scheme.

Certificate of Debt Waiver and Debt Relief

Marginal/Small Farmer

In the case of the small farmer or marginal farmers, upon waiver whole of the eligible amount, the lending institution will issue a certificate to the outcome that the loan has been waived and specifically mention the eligible amount that has been waived.

Other Framer

In the case of ‘other farmers’, upon giving OTS relief, the lending institution will issue a certificate to the outcome that the loan account has been settled to the fulfilment of the lending institution and clearly mention the eligible amount, the amount that has been paid by the farmer as his share and the value of OTS relief. The certificate would be in such form as that may be prescribed by NABARD/RBI and upon issuing the certificate by the lending institution will take an acknowledgement from the farmer.