Maharashtra Raises Farm Loan Waiver Ceiling to ₹2 Lakh, Expands Cover to 56 Lakh Farmers

Chief Minister Devendra Fadnavis took to the Maharashtra State Assembly to announce a significant restructuring of the state's farm debt relief architecture. The centrepiece change is a fourfold increase in the per-farmer waiver ceiling — from ₹50,000 to ₹2 lakh — under the Punyashlok Ahilyadevi Holkar Shetkari Karjmukti Yojana.

Equally significant is the removal of a prospective eligibility hurdle: farmers are no longer required to repay their crop loans during 2026-27 in order to qualify for the subsidy. Previously, that repayment condition had effectively locked out a large section of distressed cultivators who lacked the liquidity to pre-qualify.

Fadnavis acknowledged that the push to revise the cap came from within the ruling Mahayuti alliance, with legislators approaching him directly to urge removal of the ₹50,000 ceiling. He described the revised programme as a fulfilment of the alliance's pre-election commitment to deliver comprehensive debt relief to farmers trapped in a cycle of borrowing.

The revised scheme sets a new eligibility benchmark centred on repayment behaviour rather than a single-year precondition. Under the updated norms, any farmer who has made regular crop loan repayments in at least two of the last three years will qualify for the waiver — a criterion the government says is both fair and inclusive.

Farmers who had already benefited under the 2019 loan waiver scheme are also covered, provided they meet the revised eligibility standard. Previously, such farmers were capped at a relief of ₹50,000; they can now receive up to ₹2 lakh under the new framework.

Fadnavis also pushed back against opposition claims that the scheme would leave out 36 lakh farmers and disburse only ₹12,000–13,000 crore, calling such assessments inaccurate and reiterating that the total benefit would reach ₹36,585 crore across 56 lakh beneficiaries.

The Maharashtra government did not arrive at the revised scheme in isolation. Fadnavis told the Assembly that authorities held detailed consultations with nationalised, commercial, and private banks and gathered granular data on outstanding farm loans before finalising the Punyashlok Ahilyadevi Holkar Shetkari Karjmukti Yojana.

This multi-lender engagement is notable — farm loan waivers in India have historically created friction between state governments and institutional lenders over reimbursement timelines and credit discipline. By looping in banks at the design stage, the government appears to have sought to pre-empt implementation bottlenecks.

Fadnavis framed the scheme's objective in practical terms: not to make farmers wealthy, but to free them from the debt trap that pushes them towards informal moneylenders. The Chief Minister stated that the decision was taken in view of the prevailing agrarian situation in the state, signalling that distress conditions on the ground — rather than political optics alone — drove the policy shift.

At ₹36,585 crore, the revised loan waiver programme represents a significant fiscal commitment for Maharashtra's exchequer. Fadnavis described the initiative as "historic," stating that no similar decision had been taken before — a claim that positions this revision as the most expansive version of the state's crop loan relief architecture to date.

The scheme's design — broad eligibility, a meaningful ceiling, and no forward-looking repayment precondition — is intended to maximise reach among the state's farming community. The 56 lakh farmer target, if achieved, would represent a substantial share of Maharashtra's cultivator population.

Key parameters at a glance:

• Waiver ceiling: ₹2 lakh per farmer
• Total outgo: ₹36,585 crore
• Eligible farmers: 56 lakh
• Eligibility criterion: Regular repayments in 2 of last 3 years
• Condition removed: Mandatory crop loan repayment in 2026-27