Government Not Considering Full Farm Loan Waiver: FM Nirmala Sitharaman

As per PTI report, the Central Government is not considering any proposal to waive farm loans in full, Finance Minister Nirmala Sitharaman said in the Lok Sabha on March 23, 2026. The statement was made in response to a query on relief measures for the agriculture sector. 

She said the government is not examining such a move at present. 

Credit Schemes Continue 

Support to farmers is being routed through existing credit schemes. Under the Kisan Credit Card (KCC) system, crop loans of up to ₹3 lakh are available at subsidised interest rates through the Modified Interest Subvention Scheme (MISS). 

Additional interest relief is provided to borrowers who repay on time. The limit for collateral-free short-term agricultural loans, including allied activities, has been raised from ₹1.60 lakh to ₹2 lakh. 

Bank Lending and Income Support 

Banks continue to extend credit to agriculture under Priority Sector Lending norms issued by the Reserve Bank of India. This is meant to ensure access to formal credit. 

The government also runs income support and insurance schemes. Direct transfers are provided under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN), while crop insurance schemes cover production risks. 

Position on Disability Pension Tax 

In a separate reply, the minister said tax exemption on disability pensions for armed forces personnel will continue under the Income-Tax Act, 2025. 

She noted that the exemption existed under earlier laws and has been retained through a specific provision in the Finance Bill, 2026 to avoid any gap. 

As of January 31, 2026, 1,47,263 personnel had retired with disability. Of these, 89,598 personnel invalided out of service are receiving disability pensions. 

Medical Boards and Service Matters 

Disability classification is determined by medical boards under the armed forces’ regulations. These boards assess the condition and specify any service restrictions. 

Promotion-related matters are handled separately by the respective service branches. 

Read More: Goldman Sachs Slashes India 2026 Growth Forecast to 5.9% Amid Currency Pressures! 

Conclusion 

The government has reiterated that it is not considering a full farm loan waiver, while continuing with credit-linked support and existing welfare provisions. 

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