· Farm Loan waiver creates financial stress .
· It does not reach to the farmers that need them. It goes to the well connected person.
· The farm loan waiver by the state government creates stress on the Center Government to grant similar waivers.
· This affects the credit targets of the financial system adversely. This affects credit culture and the flow of credit negatively.
· It creates the environment for future Non-Performing Assets.
· An all party agreement is needed in this regard.
· It reduces availability of finance for education , health , banking and infrastructure and other macro-economic requirements.
· Money is transferred from tax payer to borrower.
· It is not a sustainable solution.
· It is not fair to the farmer who has repaid his loan.
· It reduces financial discipline.
· It puts heavy stress on public sector banks.
· It causes inflation.
· It puts heavy stress on public sector banks.