Banks have been able to recover a mere Rs85 crore from farmers and banks, who had fraudulently milked the UPA government’s ambitious Rs52,000 crore-farm loan waiver scheme, according to information obtained under the Right to Information Act.
The scheme, announced in 2008, was meant to prevent suicides among small and marginal farmers unable to repay loans. However, unscrupulous banks extended the waiver to those ineligible for the scheme or to farmers who had taken loans for marriages or other purposes. Of the 90,000 cases that the Comptroller and Auditor General of India (CAG) probed into, it found lapses and violations in 22% i.e. about 19,800 cases, amounting to a waiver of about Rs 100 crore.
Since only 90,000 cases were probed, it would be fair to assume that the total violations would be significantly higher.
The CAG, in a damning report released in March 2013, had noted that big farmers had tampered records, and banks had forged documents and manipulated figures to milk the scheme.
Subsequently, the Reserve Bank of India and NABARD asked banks to verify all the claims of 3.5 crore farmers covered under the scheme, and recover money from ineligible beneficiaries by June 2013.
Information obtained from the ministry of finance reveals that Rs 85 crore has been recovered in 5,092 cases. 499 cases have been registered against bank auditors (see box). The recovered amount is negligible if one considers that only 5,092 cases of fraudulent waivers have been identified thus far.