Tamil Nadu CM Vijay Announces Full Farm Loan Waiver Up To ₹75,000

Tamil Nadu Chief Minister C Joseph Vijay on Monday announced a full waiver of cooperative agricultural loans of up to ₹75,000, extending the state government's relief measures for farmers despite the financial pressures facing the exchequer.

Farmers with cooperative loans of up to ₹75,000 will now receive a 100% waiver, as per PTI. Those whose loans are between ₹75,000 and ₹1 lakh will be eligible for relief of up to ₹75,000, while borrowers with loans above ₹1 lakh will receive a maximum waiver of ₹35,000.

Making the announcement under Rule 110 in the Tamil Nadu Assembly, Vijay said the fresh measure would entail an additional financial commitment of around ₹953.06 crore and provide relief to more than 1.38 lakh farmers.

"This initiative will provide additional support to over 1.38 lakh farmers, representing an additional financial commitment of approximately ₹953.06 crore by the government, with a total waiver amount reaching ₹6,220 crore for 13.34 lakh farmers," Vijay said, as per PTI.

Expansion Of Earlier Loan Relief

The latest decision builds on the farm loan waiver announced shortly after the Vijay-led government assumed office in May.

Agricultural loans of up to ₹50,000 were initially waived within 15 days of the government taking office, as per PTI.

The programme was subsequently expanded to provide full relief for loans up to ₹75,000, while borrowers with higher outstanding amounts received a waiver of ₹35,000. Vijay said the earlier measures had benefited more than 14.44 lakh farmers.

The fresh package followed consultations with agricultural unions on August 7. Vijay said the government had decided to extend further support even as it faced financial constraints and requirements related to settlements with cooperative banks, as per PTI.

Welfare Push Raises Fiscal Questions

The announcement comes as the TVK government completes around 100 days in office. Vijay's administration had initially raised expectations of greater fiscal prudence after releasing a White Paper on Tamil Nadu's finances in June.

However, recent proposals, including farm loan waivers and other welfare schemes, have reinforced concerns about the fiscal burden of extensive state support, as per CNBC-TV18.

Alongside welfare measures, the government has also pursued investment commitments. Tamil Nadu has reportedly signed 97 MoUs worth ₹67,452 crore in August, taking total investment commitments since the new government assumed office beyond ₹1 lakh crore.