Farmers Empowerment Programme - Farmers Debt RedemptionTransfer of Funds by

RythuSadhikaraSamstha to the Farmers Accounts Orders Issued

FINANCE (EBS-II A&C) DEPARTMENT
G.O.MS.No. 218 Dated 04-12-2014
Read the following:
1. GO Ms No. 164 Finance (IF) Department dated 02.08.2014
2. GO Ms No. 174 Finance (IF) Department dated 14.08.2014
3. GO Ms No 20 of Planning (VII) Department dated 27.09.2014
4. G.O.Ms no 197 Finance (R&E) Department dated 04.10.2014
5. SLBC letter No 666/30/02/-B/577 dated 18.11.2014
6. GO Rt. No. 2583 and GO Rt. No 2584 of Finance (EBS II) Department
dated 18.10.2014
ORDER:
1. In the reference first read above, the Government issued orders for redemption of
agricultural crop loans and gold loans availed for agricultural purpose, together not
exceeding Rs 1.50 lakh per family. In the reference second read above, the Government
issued operational guidelines for implementing the debt redemption scheme to the
farmers. In the reference third read above, the Government outlined its vision to be
among the three best States in India by 2022, when India celebrates its 75th year of
independence and to achieve the status of a developed State by 2029. In order to
achieve these goals, the Governmentdecided to adopt a mission approach and launched
seven sector-specific Missions that are critical for the social and economic growth of the
State. One of the seven Missions includes the Primary Sector Mission, which is the
principal instrument for farmers empowerment.
2. In GOMs No 181 of Finance (IF) Department dated 01.09.2014, the cut-off date
for the waiver of loans disbursed for crop purposes, including the loans converted as
MTL due to calamities, was prescribed as up to 31.12.2013 and outstanding as on
31.12.2013, even if they were repaid. In GOMs 184 of Finance (B&IF) Department,
dated 03.09.2014, the Government established a State Level Grievance Redressal
Committee with the Deputy Chairman, State Planning Board as the Chairman.
Farmers Debt Redemption
3. Redemption of farmers debt has been one of the most important policy
commitments of the Government to provide the much-needed private as well as public
investment for productivity enhancement and value addition to the Agricultural sector.
The Governments objective is to provide the much-deserved and long awaited relief to
the farm families who have been pauperized over the years by moneylenders,
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unregulated micro-finance institutions (MFIs), and grossly inadequate investment in

agriculture over a decade.
4. The Governments Farmers Debt Redemption policy seeks to harmonise the
expectations and requirements of the farmers, vibrancy of the banking system, and the
development demands of the state. In order to provide an integrated institutional
mechanism for delivery of all programmes, schemes and activities intended for farmers
empowerment, encompassing welfare, development, capacity enhancement, credit flow,
financial support and allied empowerment activities, the Government, after careful and
thorough consideration of all possible options, ordered for the establishment of

RythuSadhikaraSamstha in the reference fourth read above. The

RythuSadhikaraSamstha has been assigned responsibility for channelling funds to the
farmersequivalent to the agricultural debt eligible for redemption under the provisions of
Government Orders issued from time to time. In addition, the RythuSadhikaraSamstha
would receive and channel funds, programs and development activities meant for
farmers development. Accordingly, in the references sixth read above, the Government
has released Rupees Five Thousand Crores (Rs 5,000 Crores) to the
RythuSadhikaraSamstha for the purpose of Farmers Debt Redemption.
5. During the past six months, the Government has made extensive efforts to collect
and compile the entire data relating to outstanding agricultural debt from all the Banks.
The data so collected has been validated and the eligibility for coverage under the
scheme has been determined based on the information provided by the Banks in the 34column template duly integrating the Aadhar Number, Ration Card Number; Land
proof, etc. Following further verification with the assistance of Banks, the farm families
eligible for debt redemption in the first phase (Phase-I) are being approved for debt
redemption initially in these orders.
6. The list of farm families (RythuKutumbalu) cleared for debt redemption during the
first phase has been computed based on the information provided by the Banks and
validated after careful scrutiny using the IT application developed by NIC. The
beneficiary details have been compiled for every Bank and every Branch. The list of
those cleared for debt redemption in the Phase-I is being published online for the
information of the public shortly and the list will be delivered to the
RythuSadhikaraSamstha, Banks and the other key stakeholders. Verification and
clearance of the remaining accounts will be undertaken during the second Phase (PhaseII).
7. After considering all aspects of farmers debt redemption matter, the Government
hereby orders that the RythuSadhikaraSamstha shall transfer an amount equivalent to
the debt eligible for redemption of the farmer families having Rupees Fifty Thousand (Rs
50,000) and below approved for redemption in Phase-I. To extend every possible benefit
to the farmer families, the Government is ordering for redemption of entire outstanding
debt of Rs fifty thousand and below, without reference to the scale of finance (SOF).
Those farmer families having debt eligible for redemption above Rupees fifty thousand
and below Rupees one Lakh and Fifty Thousand (Rs 50,000 150,000), will be
transferred an amount equivalent to twenty per cent (20%) of the outstanding debt
eligible for redemption. The RythuSadhikaraSamstha is hereby ordered to transfer the
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amount to the account of the farmer families with immediate effect duly following the
procedure outlined below.
8. With regard to the farmer families, who are approved for coverage under the
Debt Redemption Scheme, having an outstanding eligible debt of more than Rupees
Fifty Thousand, the RythuSadhikaraSamstha will issue Subsidy Certificates that would
carry an annual interest of ten percent (10%), which could be redeemed by the farmer in
four equal annual instalments, or earlier, as determined by the Government after
periodic review. The Government will issue separate guidelines for the administration of
Subsidy Certificates by RythuSadhikaraSamstha.
Procedure for Transfer of Funds

9. The RythuSadhikaraSamstha shallbe the Nodal Agency to co-ordinate, supervise,

and monitor all activities relating to the Farmers Debt Redemption Scheme. The
Samstha will transfer funds received from the Government in the reference sixth read
above, through an Escrow Account to be established for the purpose of Farmers Debt
Redemption. The Samstha will facilitate all Banks participating in the Farmers Debt
Redemption Scheme to establish an Escrow Nodal Account for the Farmers Debt
Redemption at the Head / Zonal / Regional level, as per the convenience of the
concerned Bank.
10. Based on the details of farmer families cleared for debt redemption by the
Government in the first phase communicated through NIC / Finance Department
the RythuSadhikaraSamstha will order for transfer of amount eligible for redemption to
each Bank Branch. Based on this authorisation, the participating Banks will transfer the
authorised funds from theEscrow Nodal account to their Bank Branches. Each Bank
Branch will establish a Escrow Current Account to be utilised for the exclusive purpose
of receiving and managing funds relating to the Farmers Debt Redemption Scheme.
11. The Branch Manager shall be responsible for careful verification of the
beneficiary accountcleared under the Debt Redemption Scheme, confirm the
outstanding balance based on the Bank records, tally with their books, verify the
correctness of the amount authorised for transfer for debt redemption by the
RythuSadhikaraSamstha. The Branch Manager shall appropriate the insurance claim, if
any, received from the Agriculture Insurance Company of India Ltd (AIC), by
notionally reducing the outstanding balances in the respective accounts as on 31
December 2013, before computing the amount of benefit.
12. The Branch Managers shall obtain an application-cum-affidavit from each
beneficiary family in the format to be prescribed by the RythuSadhikaraSamsthabefore
transferring the benefit to the beneficiary account. The Branch Manager will transfer the
debt redemption entitlement amount to the farmers loan account. The farmers who
receive benefit under the Scheme are eligible for fresh finance from the lending
institution, including additional amount, if any required and found eligible. Where the
amount of redemption is less than the outstanding amount, fresh loan will be sanctioned,
if requested, depending on eligibility.
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13. The Branch Manager will be responsible and accountable for the accuracy of the
redemption claimed and credited to the beneficiary account. In the event of any
beneficiarys loan account being credited in excess of the eligible amount he/she is
entitled to, the concerned bank shall recover the excess amount and credit back the same
to the account of RythuSadhikaraSamstha.
14. The Branch Managers are required to ensure that all documents pertaining to the
debt redemption scheme are preserved carefully, including the application-cum-affidavits
obtained from the beneficiaries, security documents obtained while advancing the loan,
the remarks of the Branch Manager on application, and other related documents. Every
document maintained, every list prepared and every certificate issued for the purpose of
scheme shall bear the signature and designation of the authorised officer of the Bank.
15. The Branch Manager will furnish a detailed Statement of Expenditure (SOE)
duly certified along with the Utilisation Certificate in the format prescribed by
RythuSadhikaraSamstha to the Nodal Bank. All Banks are requested to conduct audit of

the implementation of the scheme to ensure strict adherence with the letter and spirit of
the debt redemption scheme. The RythuSadhikaraSamstha and the Government will
also conduct special audit of the implementation of the scheme, if necessary, through
authorised representatives.
16. The Nodal Bank will collect and compile the list of all farmer families who have
received benefit under the scheme along with the amount transferred to the beneficiaries,
bank wise and branch wise, after obtaining certification from the Branch Managers that
they have complied with the stipulations and requirement of the Debt Redemption
Scheme. These details will be furnished to the RythuSadhikaraSamstha, which will
establish a monitoring mechanism of its own - either directly or through an independent
entity to ensure that the funds are transferred to the famer families in accordance with
the letter and spirit of the Debt Redemption Scheme. The RythuSadhikaraSamsthashall
furnish detailed certified Statement of Expenditure (SOE) along with the Utilisation
Certificate (UCs) to the Government before 28 February 2015.
Phase II Verification
17. All those farmer accounts that could not be cleared during the Phase-I for want of
documentation are being given an opportunity for completion of the verification process
in the second phase. The NIC will furnish the list of remaining / pending loan accounts
for providing coverage under the scheme that could not be finalized for want of critical
information. This list will be made available to the bank-branches and placed in public
domain to enable them to furnish the information or documents to the Bank to become
eligible for debt redemption under the scheme during Phase-II.
18. The farmers, who are not cleared for debt redemption in the first phase are
required to submit an application online through the concerned Bank along with the
documents in support of his / her claim. The Branch Manager, will carefully examine all
such applications in accordance with the Government instructions issued from time to
time and make appropriate recommendations. The concerned Bank Manager will
forward these recommendations, duly supported by a detailed explanatory note, online
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to the NIC portal established for this purpose.The NIC will review the information
furnished by the MLGRC and update the information in accordance with the scheme
guidelines and furnish appropriate advisory within four weeks from the issue of these
orders.
(BY ORDER AND IN THE NAME OF THE GOVERNOR OF ANDHRA PRADESH)
Dr. P.V. RAMESH
PRINCIPAL SECRETARY TO GOVERNMENT (R&E)
To
Chief Executive Officer of RythuSadhikaraSamstha
The Convenor of State Level Bankers Committee
Copy:
The Chief Secretary to the Government
The Deputy Chairman of the Planning Board
The Special Chief Secretary, Planning Department
Principal Secretary, Department of Agriculture
Principal Secretary, Department of Horticulture, Co-operation and Marketing
Principal Secretary, Department of Animal Husbandry and Fisheries
Principal Finance Secretary

Principal Secretary, Finance (R&E) Department

The Principal Secretary / Secretary to the Honble Chief Minister
All Special Chief Secretaries / Principal Secretaries / Secretaries to Government
The Chairman and Managing Director, Andhra Bank, Hyderabad
The Managing Director, State Bank of Hyderabad
The Chief General Manager, State of Bank of India, Hyderabad
The Heads of All Participating Banks in Andhra Pradesh
The Commissioner and Director of Agriculture
Heads of all departments and Managing Directors and CEOs of Corporations, Soceities
and Co-operatives under the control of the Department of Agriculture and Co-operation
All Heads of Departments of Government of Andhra Pradesh
Private Secretary / OSD to all Honble Ministers of Andhra Pradesh Government
Private Secretary to the Honble Chief Minister of Andhra Pradesh
Heads of all Departments
All District Collectors
The Special Chief Secretary to the Governor, Andhra Pradesh, Hyderabad
//FORWARDED BY::ORDER//
SECTION OFFICER