Rahul Gandhi

New Delhi, April 24: The Centre will rework its farm loan write-off plan as Rahul Gandhi had advised, extending it to farmers owning more than 2 hectares in dry areas like Bundelkhand and Rajasthan.

The move, being finalised by the finance ministry, will increase the waiver’s size from the announced Rs 60,000 crore to Rs 65,000-70,000 crore.

Finance minister P. Chidambaram may announce the scheme’s enlargement as early as next week once it is cleared by the cabinet.

The loan waiver, announced in the budget, had set a 2-hectare ceiling for complete write-offs. Farmers with larger land were eligible for a quarter of the loan being waived if they themselves were ready to repay the rest.

Critics had said that farmers owning more than 2 hectares in non-irrigated, dry areas were poorer than those who owned less than 2 hectares in the well-irrigated, fertile Gangetic plains.

Soon after the budget presentation, Rahul had demanded in the Lok Sabha that the land ceiling for the write-off should take soil productivity into account.

Earlier this week, however, agriculture minister Sharad Pawar had surprised Parliament by indicating that the government might not rework the scheme.

“We are not in a position to take on new responsibilities till the present commitments (the Rs 60,000-crore package) are implemented,” Pawar had told the Lok Sabha on Monday.

Many politicians interpreted this as Pawar’s way of getting back at the Congress for blaming him behind his back for the current food crisis.

Chidambaram had earlier said the government would pay banks Rs 25,000 crore this year, in instalments of Rs 10,000 crore and Rs 15,000 crore, to offset losses from the write-off.

Officials said the pay-out may be increased, too. They were confident that with buoyant tax revenues, “it will not be difficult to pay more money this year itself”.