Maha Vikas Aghadi govt in Maharashtra could focus on farm debt waivers

The state govt can go for a waiver of Rs 50,000 crore spread over a couple of years, said Macquarie.

Business Standard : The change of guard in Maharashtra could lead to large farm debt waivers and projects getting stalled, warned Macquarie.

Farm distress and debt waivers were part of the election campaign by the Opposition parties in Maharashtra against the ruling Bharatiya Janata Party (BJP) government.

Now, an alliance of the Shiv Sena, the Nationalist Congress Party (NCP) and the Congress, is set to form the government and expected to address the farm distress. And, they will have adequate fiscal space to do so, Macquarie estimated.

“Farm loan waiver can potentially be the first order of the business of the new government,” the brokerage said.

Maharashtra’s GDP of Rs 26.603 trillion had a fiscal deficit of 2.1 per cent in fiscal year 2018-19 (FY19) and targets were set to keep it at the same level for FY20.

“The Maharashtra government can do a waiver of Rs 500 billion (Rs 50,000 crore) spread over a couple of years without breaching limit of 3 per cent set under FRBM Act,” the brokerage said, adding that most of the public sector banks would have exposure to Maharashtra’s agriculture sector. Even as there were no large micro finance institutions, smaller cooperative banks dominate the agriculture loan market.

Maha Vikas Aghadi govt in Maharashtra could focus on farm debt waivers

Projects at high risk of getting stalled includes the Mumbai-Ahmedabad high-speed rail along with the Mumbai Nagpur Expressway. L&T was the front runner in getting the high speed rail contract, but that may get negated now. The Mumbai-Nagpur Expressway is split into 16 packages, all of which have already been awarded.

However, the metro and airport projects would likely continue as they are in advanced stages of completion, but the pace of execution could get affected, Macquarie warned. Funding for these projects are primarily coming from multilateral agencies. The real estate sector would likely get a boost.

The Reserve Bank of India (RBI) has been against any farm debt waiver. Recently, a committee headed by Deputy Governor M K Jain had said the focus should be to enhance productivity of the agriculture sector, and not debt waivers.

Their report pointed out that since 2014-15, debt waivers saw an unprecedented rise in the country, led by the state governments. According to the report, 10 states announced loan waivers aggregating Rs 2.4 trillion (1.4 per cent of 2016-17 GDP at current prices) since 2014-15.

Constitution Day: Oppn parties may boycott joint sitting of Parliament

Govt is celebrating 'Constitution Day' or 'Samvidhan Diwas' on Tuesday in the Central Hall of Parliament to mark the 70th anniversary of adoption of the Constitution by the Constituent Assembly.

Some opposition parties including the Congress are likely to boycott the joint sitting of Parliament on Tuesday called to commemorate the Constitution Day.

Sources said the opposition led by the Congress, left parties and NCP, TMC and DMK have planned a joint protest outside Ambedkar statue inside Parliament complex against the political developments in Maharashtra and installing a government led by Devendra Fadnavis with Ajit Pawar as deputy chief minister.

The government is celebrating 'Constitution Day' or 'Samvidhan Diwas' on Tuesday in the Central Hall of Parliament to mark the 70th anniversary of adoption of the Constitution by the Constituent Assembly.

President Ram Nath Kovind, Vice President M Venkaiah Naidu, Lok Sabha Speaker Om Birla and Prime Minister Narendra Modi will address the MPs on the occasion.

The President will also inaugurate a digital exhibition through video conferencing.

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Maharashtra govt approves Rs 79 bn for water projects in drought-hit areas

The jumbo proposal is aimed at the completion of works in Konkan, Nashik, Aurangabad, Amravati, Nagpur and Pune divisions.

Maharashtra drought : The Maharashtra government has approved over Rs 70 billion to complete the drinking water projects in scarcity-hit areas, state minister Babanrao Lonikar said.

The government is committed to provide water to all villages that are perennially dry, the water supply and sanitation minister said in a release issued last night.

Under the National Rural Drinking Water Scheme, the government has approved a proposal of Rs 79.52 billion for completing 6,624 water projects in 10,583 villages, he said.

The jumbo proposal is aimed at the completion of works in Konkan, Nashik, Aurangabad, Amravati, Nagpur and Pune divisions.

Nearly 6,500 projects have already been completed in the last four years by spending Rs 55 billion, Lonikar said.

During the last four years, the main emphasis was to complete the pending projects, he said.

The water supply department ensured that funds were properly utilised and action was taken against district bodies misusing the money, he added.

Notably, the Marathwada region of Maharashtra is a perennially drought-hit area.

The region received only 86 per cent of its average rainfall last year, a senior revenue official had earlier said.

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Maharashtra govt's move to ban use of plastic puts RIL in recycle mode

Company creating platform for building corpus and setting up full-fledged sustainability team.

Plastic Ban : The Maharashtra government’s decision in March to partially ban the use of plastic has put the country’s largest polymer producer in recycle mode. The Mukesh Ambani-led Reliance Industries (RIL) is now creating a platform for recycling, building a corpus and setting up a full-fledged sustainability team.


“The ban from Maharashtra was more of a wake-up call for the industry,” said Vipul Shah, chief operating officer of RIL's petrochemicals business. RIL had homework in place over the last couple of years. The ban accelerated the process, he added.


“There was earlier a small team of two to three people working on a smaller project like bottle recycling. We now have a full-fledged department for sustainability of seven to eight people working full time and another 10-12 moonlighting,” Shah added.


RIL is the country’s largest producer of polymer, the main raw material required for making plastic items. Shah did not share details on how much of the company’s polymer production is consumed through plastic bags and other items banned in the state.


“The exposure to banned items is minimal, less than three per cent maybe. It is more likely to affect small enterprises. As for RIL, there are other segments to cater to,” said a person with direct knowledge of the business.


Part of the sustainability team’s job is to develop an extended producer responsibility (EPR) platform for the industry. “Being the largest polymer producer, we want to design something that is adaptable to India and not a copy from Europe. We want to design the whole chain from segregation, collection, secondary segregation, recycling, generating energy and oil,” Shah added.


The corpus, he said, would be funded through RIL’s petrochemicals business, not as part of its corporate social responsibility programme.

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