Andhra Pradesh government is planning to adopt pyramid model while carrying out the loan waiver scheme. Government is planning to release 10000 Crores as the first installment for the loan waiver and with this amount, farmers who have loans ranging from 25000 to 50000 will become debt free. Government will give the 10000 Crores through 5000 Crores allotted in the budget and amount collected from Red Sandal auction.
It is said that 48% of the loans with the banks are below 85000. 25% farmers have loans between 85000 and 150000. So government has decided to clear the loans from the bottom. It is said that banks are full of irregularities while issuing the loans so they are not furnishing the details of the loans to the government. So far three deadlines have passed from the banks for giving the details. If they cooperate, government will want to clear the first installment of loans by October 2nd.
