New Delhi. Shri Pranab Mukherjee, Union Finance Minister, while presenting the Union Budget in Lok Sabha today, informed that an incentive of additional one per cent interest subvention to farmers who repay short-term crop loans as per schedule, is proposed to be increased to two per cent for 2010-11. Thus, the effective rate of interest for such farmers will now be 5 per cent per annum.

In view of the recent drought in some States and the severe floods in some other parts in other country, the period for repayment of the loan amount by farmers is proposed to be extended by six months from December 31, 2009 to June 30, 2010 under the Debt Waiver and Debt Relief Scheme for farmers.