The speculation over the Karnataka state Budget finally ended with newly-elected Chief Minister HD Kumaraswamy announcing sops for farmers and allocating funds for rural development.
Boost to agriculture
Delivering on his poll promises, the CM’s main focus remained the welfare of the agrarian community, where he announced a loan waiver of Rs 25,000 for farmers whose borrowings are not beyond Rs 2 lakh; who have borrowed from nationalised and non-cooperative banks. The waiver comes at a cost of Rs 34,000 crore for the state.
Further, he announced that loans will be waived of those farmers who have defaulted in their payments until 31st December 2017. He also proposed incentives for farmers who repaid loans in time. "I have decided to credit the repaid loan amount or Rs 25,000, whichever is less, to each farmer's account," he stated in his speech.
An estimated Rs 1.2 lakh crore of the net loans will be waived off by the government. A report by Kotak Institutional Equities says: Karnataka accounts for 8 percent of agricultural loans.
Following up on the promises announced by former Chief Minister Siddaramaiah-led Congress government, Kumaraswamy also announced a budgetary allocation of Rs 4,000 crore to complete the Rs 8,165 crore waiver of farm loans from co-operative banks.
The Budget also made provisions to aid agricultural activities in rural pockets of Bengaluru through Bellandur lake water and drip irrigation project, with private partnership projects.
Thrust for social enterprises
In an attempt to boost the handicrafts manufacturing and marketing, thereby generating livelihoods for the youth in the rural pockets of Karnataka, Kumaraswamy launched a new scheme called “Compete with China.”
He said the spare parts for products will be manufactured at the village-level, assembled at the Taluk level, and the goods will be marketed at shopping malls. For this purpose, plug and play industrial sheds will be constructed. Further, financial assistance of up to Rs 10 lakh will be provided to social enterprises who will help to generate employment for 5,000 SC/ST unemployed youth.
The government also announced that Chitradurga will be developed into a household LED manufacturing industry, while Hassan district will be developed as a bathroom floor tiles and sanitary goods manufacturing hub. Presently, all these goods are imported primarily from China.
Further to compete with Chinese toys, Koppal will be developed as a manufucturing cluster that will produce toys, which can be operated with battery and electricity — ICB, chip, and micro DC motor will be incorporated in these toys.
“There is a world market for such toys. In China, these mechanised toys are manufactured and supplied to the entire world. In this background, a challenge to Chinese toys, it is proposed to establish a cluster for manufacture of toys in Koppal district,” the budget document read.
Kalaburgi district will be developed as Bharath Solar district where the solar panel, inverters, capacitors and luminators for the production of solar power will be produced.
Among other notable approvals for rural development, Kumaraswamy sanctioned irrigation projects worth Rs 1.25 lakh crore. Considering the popularity of Indira Canteens in Bengaluru, he said action has been taken to open 247 Indira Canteens in all taluks and district headquarters of the state at an expenditure of Rs 211 crore.