Government Reinforces Farmer Credits Amidst No Loan Waiver, Continues Disability Pension Exemptions

Finance Minister Nirmala Sitharaman announced no complete loan waiver for farmers but emphasized measures like Kisan Credit Card initiatives. She also clarified the continuation of disability pension exemptions for armed forces, noting legislative adjustments in the Income-tax Act 2025, ensuring longstanding exemptions remain intact.

Finance Minister Nirmala Sitharaman clarified in Parliament on Monday that there is no proposal under consideration for a complete loan waiver for farmers. She underscored various governmental measures undertaken to boost the economic standing of farmers. These include timely and sufficient credit through the Kisan Credit Card scheme, offering subsidized interest rates on crop loans up to Rs 3 lakh under the Modified Interest Subvention Scheme. The government has also bolstered collateral-free short-term agricultural loans, raising them from Rs 1.60 lakh to Rs 2.00 lakh. Other initiatives involve crop insurance and direct cash transfers via Pradhan Mantri Kisan Samman Nidhi, augmenting the consistent flow of credit to agriculture through the Priority Sector Lending guidelines.

Meanwhile, Sitharaman addressed concerns regarding disability pension exemptions for armed forces members invalided due to service-related disabilities. She reassured the continuation of these exemptions under the recently enacted Income-tax Act 2025, which preserves the existing legal position without introducing new levies. The Finance Bill, 2026, explicitly proposes this exemption, maintaining a status quo for the 1,47,263 retired personnel and the 89,598 receiving pensions. There is no need for a grandfathering clause given the consistency in the legislative framework. Annual medical evaluations ensure personnel's fitness, with medical classifications determined by specialist-reviewed Medical Boards, she further explained.

On promotion policies, Sitharaman mentioned that they are managed by respective MS Branches or equivalent bodies. Her comments aimed to assure military personnel and stakeholders of the government's commitment to supporting both agricultural and defense sectors through clear, continued policies and exemptions.

(With inputs from agencies.)