Just in: UP CM Yogi Adityanath begins the process of loan waivers for farmers and a ban on slaughterhouses. The BJP in its election manifesto promised to shut "illegal slaughterhouses and mechanised abattoirs".


However, if the the UP government fulfils its farmer loan waiver promise, banks are likely to take a hit of Rs 27,420 crore and the scheme will lead to some stress on the state's fiscal arithmetic, warns a report.


The BJP had in its UP election manifesto promised to waive farmers' loans if elected to power. The party and its allies won a whopping 325 seats in the 403-member House.


An SBI Research report today said schedule commercial banks together had an outstanding farm credit of Rs 86,241.20 crore in UP with the average ticket size of Rs 1.34 lakh, as of 2016, most of which is to small and marginal farmers.

According to RBI data (2012), 31 per cent of the direct agriculture finance went to marginal and small farmers (landholdings upto 2.5 acre).

"Taking this as a proxy for UP as well, around Rs 27,419.70 crore will have to be waived off in case the farm loan waiver scheme is implemented for the small and marginal farmers, for all banks," the report said.