New Delhi: In its bid to assuage the farming community’s discontent ahead of the Lok Sabha polls, the Modi government is expected to announce several sops for farmers in the Interim Budget, which will be announced on February 1.

Despite it being a vote-of-account, the government is believed to make some big-ticket announcement to appease the distressed farming sector.

It may be noted that the government took the issue seriously after the BJP was defeated in Madhya Pradesh, Rajasthan and Chhattisgarh in the recent state polls, where rural distress was a key factor.

According to reports, while the government has no plans to announce farm loan waivers, it may consider other options, including direct cash transfer of Rs 3,000-4,000 per acre and extending crop loans at zero per cent.

Arun Jaitley, who was handling Finance ministry before going to the US for medical treatment, had clearly stated that the interim Budget may go beyond the traditional vote on account as tackling agricultural challenges “can’t afford to wait”.

The government is also considering cash handout to farmers through Direct Benefit Transfer (DBT) by subsuming the various subsidies given to the farmers on seeds, fertilizers, farm equipment, various government schemes and power.

A farm package has been in the works with various options including income transfer, a more liberal minimum support price (MSP) scheme, and interest waivers for crop loans repaid on time on the table.

The agriculture ministry has recommended several options to provide both short and long-term solutions to address agrarian distress. However, a final call will be taken in the Cabinet meeting as a huge cost is involved, IANS quoted sources as saying.

One of the options proposed is waiving interest on crop loans for farmers who pay on time, costing an additional Rs 15,000 crore to the exchequer.

There is also a proposal to completely waive premium for taking insurance policy for food crops. The Centre is also evaluating the scheme followed by the Telangana and Odisha governments wherein a fixed amount is transferred directly into the bank account of farmers, the sources further said.

Agriculture Minister Radha Mohan Singh had recently indicated that the government would announce an agriculture package before the 2019-20 budget.

Domestic ratings agency India Ratings expects the interim budget to announce an income support scheme for the poor which may at least cost the Centre Rs 1.5 trillion per annum or 0.7 percent of the GDP for the Centre and states combined and is better than any farm loan waivers.

(With inputs from agencies)