Nearly five months after announcing waiver of farm loans, the Maharashtra government kickstarted the process on Wednesday as “Diwali gift” to the state’s farmers. Rs 4,000 crore will be distributed among 840,000 beneficiaries in the first phase of the massive Rs 34,000-crore scheme.

At a function, Chief Minister Devendra Fadnavis launched a portal in which the names of the beneficiary farmers were uploaded which will be sent to the banks.

From a single bank account, the money would be transferred to various banks, which in turn would deposit the pre-defined amounts in the individual farmers’ accounts as per the list, he said.

“We have released today (Wednesday) an amount of Rs 4,000 crore, of which Rs 3,200 crore will go towards loan waivers of 462,000 farmers and the rest Rs 800 crore would be paid as incentives to 378,000 farmers who have been repaying their loans on time,” Fadnavis said.

He assured that payments funds under the Chhatrapati Shivaji Shetkari Sanman Yojana would be a continuous process till every eligible farmer was benefited, and by November 15 around 75 per cent of disbursals would be completed.

According to Fadnavis, government employees who also earn income from agricultural activities, legislators and others who are regular income tax payers have been exempted from the scheme.

However, the Chief Minister made it clear that loan waiver was not the sole solution to farmers’ problems and reiterated that continuous investment in the agricultural sector for the next five years would enable sustainable development besides reducing distress in farms.

“Our aim was to help those farmers, who had stepped outside the institutional credit systems, return to the system so that they don’t get stuck in the debt-trap of private money-lenders, and also ensure they can avail fresh loans from financial institutions, earn profits and repay them,” Fadnavis explained.

Detailing schemes for the farmers, he said the investments amounting to Rs 21,000 crore in 2011-2012 had now increased three-fold and stood at around Rs 63,000 crore in the agriculture sector.

Besides, schemes like the Jalyukt Shivar water conservation initiative contributed to ensure a growth rate of up to 12 per cent in the agriculture sector, which was ensuring production worth over Rs 40,000 crore in actual terms, he said.

Fadnavis said farmlands had been experiencing many problems for the past few years, resulting in negative growth and that was the reason the government looked at options beyond relief and rehabilitation.

The Chief Minister admitted that he was initially apprehensive about the additional financial burden of the loans waiver scheme on the state exchequer, but with the help of Finance Minister Sudhir Mungantiwar, the government finally managed the herculean task.

On June 24, the state government had announced a massive Rs 34,022 crore relief package for the farmers, days after an unprecedented 11-day strike by the farming community in the state shook the ruling establishment.

Under the scheme, the total number of beneficiaries were estimated to be around 8.90 million, but now it is expected that over four million, mostly small and medium farmers, shall become completely debt-free, becoming eligible to avail fresh bank loans.