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By:

Abhijit Mulye

21 August 2024 at 11:29:11 am

Fadnavis writes off Rs 48,000 crore

Mumbai: In a clear indication that the Maharashtra government is leaving no stone unturned to keep the state’s agrarian base happy, Chief Minister Devendra Fadnavis has unleashed yet another massive populist measure. Hot on the heels of relaxing the eligibility criteria to ensure a blanket farm loan waiver, the Chief Minister announced a sweeping Rs 48,000 crore waiver on the pending electricity bills of farmers across the state. Addressing a ‘Krutadnyata Sohala’ (gratitude ceremony)...

Fadnavis writes off Rs 48,000 crore

Mumbai: In a clear indication that the Maharashtra government is leaving no stone unturned to keep the state’s agrarian base happy, Chief Minister Devendra Fadnavis has unleashed yet another massive populist measure. Hot on the heels of relaxing the eligibility criteria to ensure a blanket farm loan waiver, the Chief Minister announced a sweeping Rs 48,000 crore waiver on the pending electricity bills of farmers across the state. Addressing a ‘Krutadnyata Sohala’ (gratitude ceremony) organized by the BJP Kisan Morcha at Mumbai’s Yashwantrao Chavan Pratishthan on Wednesday, Fadnavis declared that farmers using agricultural pumps of up to 7.5 horsepower will see their historical electricity dues completely wiped out. The announcement was met with the traditional sounding of the Tutari and thunderous applause from hundreds of farmers who had gathered from every corner of the state. The Chief Minister framed the mega-sop as a necessary step to “wipe the farmers’ slate clean,” enabling them to write a new chapter of prosperity. Calculated Pitch The timing and scale of the announcement underscore a government that is boldly embracing populist economics to solidify its political footprint in rural Maharashtra. While Fadnavis maintained that these decisions were taken purely in the interest of the farmers—pointing out that the original loan waiver was announced when no elections were in sight—the political undertones were unmistakable. Taking a sharp dig at the opposition, the Chief Minister accused rival parties of running “political shops” in the name of farmer agitations without understanding the government’s genuine intent. Asserting his grassroots connection, Fadnavis proudly claimed, “I do not make decisions sitting in my house. I am a farmer myself, a man of the soil.” He openly defended the government’s recent move to strip away the stringent conditions attached to the blanket farm loan waiver, signaling that his administration will not hesitate to clear bureaucratic hurdles if it means putting money directly into the hands of the rural voter. Balancing Sops Even as he rained freebies, the Chief Minister attempted to balance the populist optics with a dose of economic pragmatism. He acknowledged that handing out repeated loan waivers is a symptom of deep-rooted agrarian distress, not a permanent cure. Pointing to the Rs 95,000 crore in aid currently being pumped into the agricultural sector by the state and central governments, Fadnavis outlined his administration’s shift toward an investment-driven agricultural model. He championed the success of schemes like ‘Jalyukt Shivar’ and ‘Magel Tyala Shettale’ (farm ponds on demand), claiming these initiatives have already empowered farmers to harvest multiple crops a year. Addressing the core issue of farming costs, he noted that the government already subsidises power to the tune of Rs 25,000 crore annually. By coupling this with a push for solar pumps and solar agricultural feeders, he promised that 100 percent of the state’s farmers would receive uninterrupted daytime electricity by the end of the year. Infra Dream Looking beyond immediate financial relief, the Chief Minister laid out a grandiose vision to permanently drought-proof Maharashtra’s most vulnerable regions. A staggering Rs 6 lakh crore infrastructure pipeline is being planned to ensure the next generation never witnesses a drought. Fadnavis detailed ambitious river-linking projects, including the Wainganga-Nalganga link, to divert excess floodwaters to parched regions. The state plans to construct 24 new dams and raise the height of 16 existing ones to ensure not a single district in Vidarbha faces water scarcity. Furthermore, massive engineering feats are on the drawing board to divert 200 TMC of floodwater from Western Maharashtra to Marathwada, and lift 275 TMC of wasted water from the Ulhas basin to quench the thirst of North Maharashtra and Marathwada. By marrying immediate, massive debt relief with long-term infrastructure promises, the Fadnavis administration is aggressively cementing its pro-farmer narrative. As the Yashwantrao Chavan auditorium echoed with whistles and cheers, it became highly evident that the government’s strategy of pairing mega populist waivers with big-ticket rural dreams is striking a powerful chord with the state’s agrarian voters.

Arm Twisting

Markets are adept at sniffing out power plays disguised as policy. Reliance Industries’ wobble this week, nearly 4 percent off its value which dragged the Nifty with I —was officially attributed to profit-taking, crude-sourcing jitters and global uncertainty. Beneath the market jargon lays a more corrosive force of American high-handedness with US President Donald Trump once again using oil as a cudgel and India as a convenient pressure point.


Reliance makes for a revealing case study. The company had touched a 52-week high, inviting routine profit-booking. Yet the sharper edge of investor anxiety came from confusion over Russian crude. A report claiming tankers were headed to Jamnagar was swiftly denied by the firm. Reliance clarified that it had not received Russian oil for weeks and did not expect any in January. For investors, the subtext is that discounted Russian crude had bolstered refining margins and its absence could squeeze them.


This, buying cheap oil is no longer merely a business decision but a diplomatic act scrutinised and punished by Washington. Trump had earlier imposed a 25 percent ‘secondary’ tariff on Indian goods, explicitly citing New Delhi’s continued imports of Russian crude sending out a blunt message that if anyone trades with whom America disapproves of, they will have to pay a heavy price regardless of domestic law, economic logic or strategic autonomy.


Trump has further warned that tariffs could be raised further if India does not fall into line.


America insists these measures are about starving Russia of revenue amid the war in Ukraine. Yet the record is riddled with convenient inconsistencies. When global oil prices threaten American inflation, Russian barrels find their way into markets through tolerable intermediaries. When others - India chief among them - secure visible benefits from discounted crude, principle hardens into punishment.


India imports more than four-fifths of its crude. Every dollar shaved off the import bill eases inflation, steadies the rupee and cushions consumers. Russian oil offers such relief. Reliance had even reduced its purchases after Washington sanctioned Lukoil and Rosneft in late November.


By turning oil flows into ‘loyalty’ tests, America is corroding the very rules-based order it claims to uphold. Secondary sanctions and punitive tariffs extend American jurisdiction far beyond its borders, weaponizing the dollar and the market access it controls. The longer-term consequence of Trump’s adversarial tactics will lead to fragmentation in form of parallel supply chains, alternative payment systems and a growing determination among middle powers to hedge against American caprice.


While Reliance’s share-price dip will pass, the larger damage is subtler. Each episode of arm-twisting reinforces the lesson that partnership with America comes with conditions unilaterally set and casually enforced.


A country that champions free markets now polices them with tariffs and threats. Trump and his advisers ought to realize that while high-handedness may temporarily intimidate investors, it accelerates the search for a world in which Washington’s hand is easier to shrug off.

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