Farm loan scam unravels in MP

The farm loan scam in Madhya Pradesh continues to unravel, as reports pour in of farmers dying and more and more farmers complaining of being named as beneficiaries of loans that they never received

Farm loan scam unravels in MP

Chandrakant Naidu

The farm loan scam in Madhya Pradesh continues to unravel, as reports pour in of farmers dying and more and more farmers complaining of being named as beneficiaries of loans that they never received. Official sources claim that the extent of the scam in the Gwalior division alone could go up to Rs 100 Crore or more.

The unfolding scam has embarrassed the BJP, as both Shivraj Singh Chouhan and Gaurishankar Bisen, the outgoing chief minister and the agriculture minister respectively, left no opportunity to proclaim that they themselves were farmers.

Chief Minister Kamal Nath has promised strict action against those involved in falsifying the list of beneficiaries. He disclosed that several farmers, who did not borrow any money but found their names among the beneficiaries, have called on him to complain.

Last week, a farmer died in Sagar district due to cardiac arrest, after being told that he owed a large amount to the bank even though he had never received the loan, his family alleged. The deceased, identified as Mukundi Adivasi, a resident of village Sardai Nayanagar, came to know that he had a loan of approximately Rs 5 lakh, displayed in a list pasted at a cooperative bank office.

District cooperative bank officials, panchayat secretaries and supervisors who processed loan verification cases are alleged to have colluded to commit the fraud. Loans were drawn through fake identities all over the state. Largest number of cases are being reported from the Gwalior-Chambal and Bundelkhand region, with fresh cases being disclosed every day. Gwalior collector Bharat Yadav said loans were drawn in the name of non-farmers and dead persons.

A former chairman of a cooperative bank claims that a flawed system led to the scam. Most farmers would keep their land documents with the panchayat secretary. Together, with the bank official and bank loan supervisor, the secretary used the documents to generate normal credit limit (NCL) slips which determined the eligibility of farmers for crop loans.

With the supervisor completely in charge of processing, many farmers never learnt of the money drawn in their name. In many cases, the panchayat secretary took part of the loan in cash and the remaining was put in a newly-created account and then withdrawn. In some cases, loans were returned too.

MP pioneered farm loan waivers: While Prime Minister Narendra Modi ridiculed the farm loan waivers announced by Congress Governments, it was the BJP in Madhya Pradesh that floated the loan waiver idea three decades ago.

On the verge of winning power in Madhya Pradesh in 1989, the BJP was campaigning for waiving of farmers’ loans. Journalists covering the state were left wondering why the BJP disobeyed its president Atal Behari Vajpayee and demanded “Rinn Mukti” or loan waivers. Vajpayee was wary of the move that could become a liability for the government in the longer run. Ironically, it was BJP which had then questioned concessions given to the industry that owed more money to the government than the farmers.

Shivraj Singh Chouhan government had set a record winning the Krishi Karman award for agricultural productivity for five consecutive years, by fudging figures. Chouhan had also promised a loan waiver up to Rs 50,000 for the farmers way back in 2012, but failed to keep his word.

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