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By:

Ramesh Patil

19 September 2024 at 9:57:34 am

Beyond the Bailout

Maharashtra’s farm loan and power bill waivers offer immediate relief, but their real test lies in building a more resilient agricultural economy. Agricultural distress is rarely caused by a single factor. For millions of farmers, the crisis is the result of a difficult combination of erratic weather patterns, rising input costs, uncertain markets, mounting debt and inadequate access to affordable credit. In Maharashtra, where agriculture remains the backbone of rural livelihoods, these...

Beyond the Bailout

Maharashtra’s farm loan and power bill waivers offer immediate relief, but their real test lies in building a more resilient agricultural economy. Agricultural distress is rarely caused by a single factor. For millions of farmers, the crisis is the result of a difficult combination of erratic weather patterns, rising input costs, uncertain markets, mounting debt and inadequate access to affordable credit. In Maharashtra, where agriculture remains the backbone of rural livelihoods, these pressures have been particularly acute in regions such as Marathwada, Vidarbha and parts of North Maharashtra. Against this backdrop, the decision of the state government under Chief Minister Devendra Fadnavis to implement the Punyashlok Ahilyadevi Holkar Shetkari Karjmukti Yojana and waive outstanding electricity bills for agricultural pumps represents a significant intervention. While farm loan waivers have often generated debate over their long-term economic implications, they also serve an important purpose when they provide distressed farmers with an opportunity to regain financial stability and return to productive activity. Substantial Relief Under the scheme, crop loans of up to Rs. 2 lakh per farmer will be waived. The initiative is expected to benefit around 56 lakh farmers, covering nearly 65 lakh loan accounts, with the state government taking on a financial burden of approximately Rs. 36,585 crore. At this scale, the decision marks one of the more substantial efforts in Maharashtra’s recent agricultural policy landscape to address rural indebtedness. The immediate impact of such a measure is clear. A farmer burdened by unpaid loans is often unable to access fresh credit from banks, leaving him trapped in a cycle of borrowing and declining productivity. By clearing eligible debts, the waiver can restore creditworthiness, improve access to institutional finance and provide farmers with the confidence to invest in the next crop cycle. However, the significance of the decision should not be viewed merely through the lens of debt relief. The larger challenge before Maharashtra is to ensure that agriculture moves from a cycle of crisis management towards sustained economic viability. The government’s decision to waive outstanding electricity bills for agricultural pumps, estimated at nearly Rs. 48,000 crore, is another major intervention. The move is expected to benefit around 30 lakh farmers. Unpaid power bills have long been a source of financial stress, often affecting irrigation access and increasing uncertainty for cultivators. Reducing this burden can help farmers maintain uninterrupted access to electricity and strengthen agricultural productivity. Yet, the true measure of agricultural policy cannot be limited to waivers alone. Relief can address immediate distress, but resilience requires deeper structural reforms. Maharashtra’s future agricultural success will depend on how effectively it improves irrigation, water conservation, technology adoption, market access and value addition. Unpredictable Monsoon The state’s vulnerability to unpredictable rainfall has become increasingly evident. For farmers in drought-prone regions, sustainable water management is no longer an option but a necessity. Investments in micro-irrigation, farm ponds, watershed development and efficient water utilisation will determine whether agriculture can withstand the uncertainties of climate change. Similarly, modernising the crop insurance system is essential. The use of technology-driven assessments, including satellite monitoring, drone surveys and digital damage assessments, can make compensation faster and more transparent. Farmers need a system that responds quickly when natural calamities destroy months of hard work. Equally important is the need to move beyond traditional farming models. Better storage infrastructure, cold chains, food processing industries and direct market linkages can help farmers capture greater value from their produce. Increasing farm incomes requires not just higher production but also better returns. The encouragement of rural entrepreneurship is another critical component. Young people in villages should see agriculture not merely as subsistence activity but as an opportunity for enterprise — through dairy farming, fisheries, poultry, goat rearing, agri-processing and technology-based farming solutions. Transforming agriculture into a modern industry could provide a new direction to Maharashtra’s rural economy. The loan waiver and electricity bill relief announced by the state government are therefore best viewed as a beginning rather than an end. Their success will depend on effective implementation, transparency, timely delivery of benefits and coordination between government agencies and financial institutions. The larger objective must be to create a farming community that is not dependent on repeated interventions but capable of standing on its own feet. Maharashtra does not merely require debt relief; it requires a financially secure and profitable agricultural sector. The state’s broader development story will remain incomplete unless its farmers are empowered, agriculture becomes sustainable and villages become engines of economic growth. (The writer is a farmer and district Vice-President, Bharatiya Janata Yuva Morcha, Latur. Views personal.)

India waits to lasso diamantaire Mehul Choksi

Mumbai: India rubbed its hands gleefully as the Belgium Police honoured its request to arrest the absconder diamantaire Mehul Chinubhai Choksi – more than seven years after he, along with his nephew Nirav Deepak Modi - allegedly duped the Punjab National Bank of nearly Rs. 13,800-crores.

 

The scam involving the ‘Mehul Mama-Nirav Bhanja’ erupted in Jan 2018, after the PNB lodged a complaint with the Central Bureau of Investigation (CBI).

 

By then the kin, along with many of their family members, winked and slipped out of the country, leaving a rattled India rubbing its palms in disappointment.

 

A political-cum-financial storm raged, embarrassing the Bharatiya Janata Party government of Prime Minister Narendra Modi a year before the Lok Sabha elections.

 

Multiple agencies launched a multi-pronged probe into what became the biggest banking scam in the past quarter century – and almost four times bigger than the stock market-cum-banking fraud the late Big Bull Harshad Mehta had inflicted on the Indian economy 33 years ago (in April 1992) – when it was just opening up.

 

In Belgium

According to official reports, Choksi was living with his Belgium citizen-wife Preeti in Antwerp, a global diamond hub, presumably for the past 18 months on a ‘residency permit’ acquired through questionable means, for medical reasons.

 

Earlier, he shot to the headers (June 2021) while being taken in a wheelchair to a court by the Dominican Republic's Police on charges of sneaking into the small country in the Caribbean Sea, North America.

 

Interestingly, as the Antigua & Barbuda government initiated the process to cancel his citizenship acquired through an investor visa, Choksi had suddenly gone ‘missing’ till he surfaced in the Dominican Republic.

 

The April 2025 action by Belgium followed a request by India’s CBI and the financial frauds specialist Enforcement Directorate (ED) to nab Choksi as the InterPol had revoked his Red Corner Notice in 2023.

 

Mama and Bhanja

‘Mama’ Choksi is the founder-owner of Gitanjali Group while ‘bhanja’ Nirav’s Firestar plus other companies – and the duo, with some PNB officials hand-in-glove – conspired to make a ‘mamu’ of not only PNB, but other banks, as it subsequently tumbled out.

 

After making a quiet exit, Choksi was detected living in the verdant Antigua & Barbuda Isles (West Indies), then attempted entry to the Dominican Republic, was sent back to Antigua & Barbuda and then went to Belgium where he was nabbed on Sunday.

 

Similarly, Modi was found sauntering on the streets of London and nabbed in March 2019. He remains in jail there since India's extradition is still pending.

 

However, India is keeping its fingers crossed that it may finally lay hands on Choksi, bring him to India and face trial in the PNB scam, though it may take time.

 

Born in Mumbai (1959) and educated in Gujarat, Choksi, 66, and wife Preeti have three children.

 

The Rs. 13,800-crore PNB scam

In the modus operandi revealed after India’s second-largest PSU bank PNB admitted it was scammed, Choksi and Modi used fraudulent Letters of Undertaking (LoU) to get overseas credits or loans from Indian banks.

 

The PNB first informed the Reserve Bank of India (RBI) of the fraud and then lodged a criminal complaint with the CBI in Jan. 2018, plus another CBI complaint in Feb, that led to a FIR against Modi and Choksi and their companies.

 

The ED entered the scene to probe the allegations of money-laundering through the LoUs – which they allegedly misused to avail short-term business finances from foreign branches of Indian banks.

 

The probe said that the duo were availing the LoUs from the PNB’s Brady House Branch from March 2011, and over the next six-seven years, managed to get a whopping 1,200-plus LoUs like a breeze with the help of some friendly bankers within.

 

Post-scam, the gold-diamond companies Gitanjali Group and Firestone Group with multiple operations in India and abroad have largely wound up, while some personal assets of the mama-bhanja have been auctioned to recover a part of the dues.

 

ED's plea to declare Choksi fugitive stuck for seven years

Even as absconding diamantaire Mehul Choksi, a key accused in the Punjab National Bank loan fraud case, has been arrested in Belgium, the ED's plea to declare him a fugitive economic offender has been pending before a court in Mumbai for nearly seven years.


Choksi, 65, and his nephew diamantaire Nirav Modi are the prime accused in the Rs 13,000 crore PNB bank loan fraud case. Choksi was arrested in Belgium following an extradition request by Indian probe agencies, official sources said on Monday.


The Enforcement Directorate had filed the application in July 2018, seeking to declare Choksi an FEO and confiscate his assets under provisions of the Fugitive Economic Offenders Act.


However, the matter has witnessed repeated delays owing to a barrage of applications filed by the accused in the PMLA court and the Bombay High Court alleging procedural lapses in the Enforcement Directorate's plea.


"The court is kept busy with frivolous applications, and hearing on our application to declare him (Choksi) an FEO has been adjourned for the past seven years,” an ED officer had said after the hearing was once again deferred this February.


"The court should have continued the hearing and taken a decision on the future course of action once the application was moved," the officer had said.

He had urged the court to take note of the repeated filing of similar applications and to not entertain them.


Choksi's lawyer had informed the court that the accused was undergoing treatment for suspected cancer in Belgium and intended to file an application in connection with his health.


Under the FEO Act, an individual can be declared a Fugitive Economic Offender if a warrant has been issued against him for an offence involving Rs 100 crore or more and he has left India while refusing to return. Once declared an FEO, the person's property can be confiscated by the investigating agency.


Choksi had challenged the ED's application in the Bombay High Court, alleging that the agency "had not followed proper procedure before filing the application and, hence, it stands vitiated".


However, in September 2023, the High Court dismissed his plea, ruling that the ED had adhered to the prescribed format under the FEO Act. It also vacated a stay on the special court's proceedings.


Despite this, the hearing on declaring Choksi FEO could not commence, with Choksi continuing to file applications before the special court through his lawyers.


While most of these pleas have been dismissed, a few remain pending. His latest attempt to stall proceedings through a plea to recall the notice issued on the ED's FEO application was rejected in December 2023.


According to ED officials, Choksi left India under suspicious circumstances in early January 2018.


Shifting stance

Choksi's counsel has argued that the ED kept shifting its stance on the material grounds for declaring him an FEO and that the suspension of his Indian passport made it impossible for him to return for investigation.

The court, however, rejected this argument, stating that the notice was issued based on accurate information and not based on "wrong facts or mistaken assumptions".


ED claimed the accused left the country under suspicious circumstances in the first week of January 2018.


Nirav Modi has already been declared as an FEO by the special court. He has been lodged in jail in London since 2019.

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