Former Reserve Bank of India Governor, Raghuram Rajan, asserted that farmers deserve more than just loan waivers.
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00:00Our farmers deserve no less, that we need to create the environment in which they can be a vibrant force.
00:30Certainly there is reason to think about farm distress, but the question of whether the flows to farmers is best effected by waiving loans, after all this is only a subset of farmers who get those loans.
00:56And so it often goes to the best connected rather than the most poorly off. And second, it obviously creates enormous problems for the fiscal of the state once those waivers are done.
01:07And I think the, unfortunately it inhibits investment down the line. Now, to the question of whether there are fiscal transfers needed for farmers and whether they need to, that is certainly an issue that needs to be debated, but also investment is needed in agriculture.
01:24And you can see the set of policies that we recommend is about how to make agriculture itself a vibrant industry as opposed to an industry which needs to be propped up through transfers.
01:35And I think our farmers deserve no less, that we need to create the environment in which they can be a vibrant force.