NEW DELHI • Beleaguered farmers in two Indian states have got some relief.
Uttar Pradesh, the country's most populous state, said on Tuesday it was waiving US$5.6 billion (S$7.8 billion) of loans to help millions of farmers reeling from losses, after unfavourable weather in the past few years hit their crops.
The high court in Chennai on the same day ordered the southern state of Tamil Nadu to waive crop loans availed by farmers hit by drought.
The court directed that the loan waiver should be extended to farmers irrespective of their land holdings and restrained officials belonging to cooperative banks from initiating any penal or recovery proceedings against those who have defaulted on repayment of crop loans.
The court's directive came days after the federal government sanctioned a drought-relief package of US$222 million to help the state which has been grappling with drought. Earlier, the local government had announced a loan waiver for farmers possessing less than 2ha of land holdings.
Tamil Nadu farmers have been staging a protest in New Delhi for more than three weeks seeking relief measures. The protesters have put dead rats and snakes in their mouth and even tonsured their heads to highlight their plight.
In January, the Tamil Nadu government declared all districts of the state drought-hit following successive years of bad monsoons.
The Uttar Pradesh farm loan waiver was expected to bring relief to 21.5 million indebted farmers, a big voting bloc in the state which is also India's largest producer of wheat and sugar. Uttar Pradesh is mainly rural and lacks industries.
The new Uttar Pradesh government from Prime Minister Narendra Modi's Bharatiya Janata Party, which swept into office with a landslide victory recently in state polls, said it would issue bonds to fund the farm loan waiver.
The state government said it also planned to set up 5,000 centres to buy wheat directly from farmers and would pay farmers 10 rupees (22 Singapore cents) per 100kg, more than the guaranteed price promised by the federal government.
Meanwhile, the continuing drought in India has forced the world's biggest sugar consumer to cut tariffs on imports, according to an official who declined to be named as he was not authorised to speak to the media. The official said India would allow imports of 500,000 tonnes of duty-free raw sugar up to June 12. India levies a 40 per cent import tax on sugar.
Imports by India, the world's second-biggest sugar producer, could support global prices, which jumped more than 3 per cent in early trades yesterday. Only last year, mills in India exported 1.66 million tonnes of sugar.
AGENCE FRANCE-PRESSE, REUTERS