Journal of Commerce and Management Thought

In the Union Budget 2008–09, the Government of India announced a scheme of Agricultural Debt Waiver and Debt Relief Scheme (ADWDR-2008) for farmers. The total value of overdue loans being waived estimated at Rs. 50,000 crores and a one-time settlement (OTS) relief on the overdue loans at Rs. 10,000 crores for implementation by all scheduled commercial banks, besides RRBs and Cooperative credit institutions. The focus of this study was to assess the distribution of benefit of ADWDR scheme to farming community in India and to examine the impact on supply of agricultural credit in India by the banks. This study was based on information gathered through secondary sources. The compound growth rate was used for the analysis of data. The study found a) benefit amongst various regions was distributed disproportionately b) Credit disbursement to agricultural sector declined and c) Credit supply to the agricultural sector in terms of number of account holders and amount financed has taken reverse trends.

In M.S. Swaminathan's word, eligibility for this kind of scheme should not be generalized. This kind of scheme needed different criteria for eligibility. In the light of above statement, the paper attempts to access the impact of the Scheme on the farmers and on the agricultural credit supply in general.