Photo: HTThe Rs8,000 crore farm loan waiver announced in the Rajasthan state budget on Monday was both predictable and disappointing. It was one of the dominos to fall last year after the Uttar Pradesh farm loan waiver; the government was compelled to announce a Rs25,000 crore farm loan waiver. The Maharashtra accountant general has released data this month and the farm loan waiver is set to hit the state’s fiscal deficit. The violent protests in Mandsaur last year, for instance, could tempt the Madhya Pradesh government to follow suit, although it has confined itself to interest waivers so far. Such waivers are not just fiscally irresponsible, they are ineffective—as past precedent has shown.

Source: Mint February 12, 2018 18:33 UTC