The Maharashtra Cabinet on Tuesday approved the ambitious Punyashlok Ahilyadevi Holkar Shetkari Karjamukti Yojana, a farm loan waiver package worth ₹36,585 crore that is expected to benefit around 5.6mn (million) (56 lakh) farmers across the state.
The scheme, one of the key promises made by the Bharatiya Janata Party (BJP)-led Mahayuti alliance during the 2024 Assembly election campaign, will provide complete relief on agricultural loans of up to ₹2 lakh and cover more than 6.5mn (65 lakh) loan accounts.
However, a formal public announcement of the scheme has been deferred because the model code of conduct is in force for elections to 17 seats of the Maharashtra Legislative Council. Polling is scheduled for 18 June, while counting will take place on 22 June 2026.
Speaking to the media ahead of the Cabinet meeting, chief minister (CM) Devendra Fadnavis said the government would finalise the scheme but could not officially announce it due to election-related restrictions.
The package has three components: a complete loan waiver, a one-time settlement (OTS) mechanism for larger loans, and incentives for farmers who have regularly repaid their crop loans.
Under the loan waiver component, farmers with outstanding crop loans of up to ₹2 lakh, including principal and interest, will receive full debt relief. The waiver will apply to crop loans taken between 1 April 2019 and 31 March 2025, provided the loans were outstanding as of 30 September 2025 and remained unpaid on 31 March 2026.
The benefit will be available irrespective of the size of the farmer's landholding.
Farmers with crop loan dues exceeding ₹2 lakh will be eligible for assistance under the OTS mechanism. To qualify, borrowers must repay the amount above ₹2 lakh by 31 March 2027. Once the excess amount is cleared, the state government will waive up to ₹2 lakh of the remaining outstanding loan.
Officials said the provision will also apply to restructured and re-restructured crop loans.
The Cabinet also approved an incentive scheme aimed at encouraging financial discipline among borrowers.
Farmers who availed crop loans in any two of the three financial years—FY22-23, FY23-24 and FY24-25—and repaid them within the stipulated period, either before 30 June following the end of the financial year or within the deadline prescribed by banks, will be eligible for an incentive of ₹50,000.
The incentive amount will be credited directly to beneficiaries' bank accounts.
The decision has drawn a mixed response from farmer organisations. While many welcomed the debt relief package, some groups argued that all eligible farmers should be covered without restrictive conditions.
Farmer leader Bachu Kadu demanded that the incentive for timely loan repayment be increased from ₹50,000 to ₹1 lakh.
The scheme will cover loans availed from nationalised banks, private banks, regional rural banks (RRBs), district central cooperative banks (DCCBs) and crop loans extended by primary agricultural credit cooperative societies from their own funds.
Farmers who benefited under the Mahatma Jyotirao Phule Farmer Debt Waiver Scheme of 2019 and subsequently accumulated fresh crop loan arrears will also be eligible for relief of up to ₹50,000, subject to prescribed conditions.
However, several categories have been excluded from the scheme. These include income-tax payers, government employees, serving and former elected representatives, officers and employees of cooperative institutions earning more than ₹25,000 per month, and pensioners receiving monthly pensions above ₹25,000.
Aadhaar authentication and registration on the AgriStack platform will be mandatory for all beneficiaries.
To ensure smooth implementation, the government has constituted a high-level committee chaired by the chief secretary.
A separate committee comprising senior officials from the cooperation department, Maharashtra State Cooperative Bank, Maha-IT, the State Level Bankers' Committee and cooperative institutions will negotiate with banks and determine the extent of concessions and settlement mechanisms.
The state government had earlier appointed a committee headed by Pravin Pardeshi, chief executive officer (CEO) of the Maharashtra Institution for Transformation (MITRA), to estimate the number of beneficiaries and assess the scheme's fiscal implications.
The committee submitted its report earlier this year, paving the way for the Cabinet's approval of the debt relief package.
