The Election Commission of India (EC) has granted its approval for Maharashtra's proposed farm loan waiver during the model code of conduct for the MLC elections, which is in effect until June 25. This clearance has paved the way for the waiver, and the state cabinet is expected to consider it next week.
Background of the Loan Waiver
Chief Minister Devendra Fadnavis had previously stated that the farm loan waiver, promised in the Mahayuti government's manifesto for the 2024 state assembly elections, would be announced before June 30. He also expressed confidence that the model code of conduct would not hinder the process. The state had formally applied to the EC for clearance.
EC's Rationale
The EC cleared the proposed loan waiver on the grounds that it had been announced well before the election period. Additionally, voters in the MLC polls—comprising members of zilla parishads, municipal councils, and corporators—are not beneficiaries of the waiver, as these categories are likely to be excluded.
Scope and Cost of the Waiver
Around 35 to 40 lakh farmers in Maharashtra are expected to benefit from the waiver, which will cost the exchequer approximately Rs 27,000 crore, according to the Pardeshi panel report submitted to Chief Minister Fadnavis. The CM had announced the Punyashlok Ahilyadevi Holkar farm loan waiver scheme during the state budget in March. This includes a crop loan waiver of up to Rs 2 lakh for farmers with arrears until September 30, 2025.
“Approximately 28-30 lakh farmers will benefit from the loan waiver. Additionally, 20 lakh farmers who have been repaying their instalments regularly will receive Rs 50,000 as an incentive payment,” Fadnavis had said.
Political Context
The waiver was announced following agitations by the Prahar Janshakti Party led by Bachchu Kadu. This led to the formation of the Pardeshi committee in October 2025 to suggest criteria for the waiver and formulate solutions for the state's agrarian distress.
Previous Loan Waivers
This will be the third farm loan waiver in Maharashtra. The Chhatrapati Shivaji Maharaj Shetkari Sanman Yojana 2017 was announced by the BJP-Shiv Sena government then led by Fadnavis. In 2019, the MVA government led by Uddhav Thackeray announced the Mahatma Jyotirao Phule Shetkari Karjmukti Yojana.
