Himachal Pradesh Agriculture Loan Interest Subvention Scheme

What is the Himachal Pradesh Agriculture Loan Interest Subvention Scheme?

Himachal Pradesh Agriculture Loan Interest Subvention Scheme is a state relief measure under which the Himachal Pradesh government pays 50 per cent of the outstanding interest on an overdue agricultural loan of up to Rs 3 lakh per farmer, as part of a one-time settlement. Chief Minister Sukhvinder Singh Sukhu announced the scheme in late June 2026, describing it as the fulfilment of a state budget commitment.

The problem the scheme addresses is narrow and specific. A farmer who borrows against agricultural land from a cooperative land development bank and then falls behind sees interest keep accruing on the defaulted account. Once the account is classified as overdue, the mortgaged land itself can be put up for auction by the lender. The scheme is aimed exactly at that group: farmers whose agricultural loans have turned overdue and whose land holdings are under threat of auction by financial institutions.

The state government has earmarked Rs 50 crore, and about 6,356 farmers across Himachal Pradesh are expected to benefit.

Key features

• 50 per cent of outstanding interest borne by the state government.
• Loan ceiling of Rs 3 lakh per farmer for the relief.
• Structured as a one-time settlement, not a rolling annual subsidy.
• Rs 50 crore provision, about 6,356 expected beneficiaries.
• Delivered through two cooperative land development banks, not through a public application portal.

Which banks implement the Agriculture Loan Interest Subvention Scheme?

The scheme is implemented through two institutions:

• Himachal Pradesh State Cooperative Agriculture and Rural Development Bank
• Kangra Cooperative Agriculture and Rural Development Bank

These are the state's long-term cooperative credit institutions, the banks that lend against agricultural land for land development, minor irrigation, farm mechanisation and allied purposes. They are the reason the relief is framed around auction risk: their lending is secured on the land itself.

Branches of these two banks identify eligible borrowers and prepare the list of beneficiaries. That is the entire selection mechanism announced so far. There is no public form, no online portal for this scheme and no advertised last date.

Who is eligible for the Agriculture Loan Interest Subvention Scheme?

You can be covered if:

• You are a farmer in Himachal Pradesh with an agricultural loan from the HP State Cooperative Agriculture and Rural Development Bank or the Kangra Cooperative Agriculture and Rural Development Bank.
• Your loan account has turned overdue. The relief is for defaulted accounts, not for accounts being serviced normally.
• Your outstanding agricultural loan is up to Rs 3 lakh.
• You are willing to settle the account on one-time settlement terms, paying the principal and your half of the interest.

You are not eligible if:

• Your agricultural loan is regular and not overdue. The scheme does not reward accounts that are current.
• Your loan is from a commercial bank, regional rural bank or a cooperative bank other than the two named. No other lender was included in the announcement.
• The borrowing was not for agriculture. Personal, housing or business loans from the same institutions were not covered by the announcement.
• You are looking for relief on the principal. Only interest is shared, and only half of it.

A borrower with an outstanding loan above Rs 3 lakh should ask their branch directly how the ceiling is applied to their account; whether the relief is capped at the interest attributable to the first Rs 3 lakh, or whether accounts above the ceiling are excluded entirely. The announcement did not settle that point, and the branch working the list is the authority on it.

How to apply for the Agriculture Loan Interest Subvention Scheme

There is no public application form. The realistic sequence for a farmer is this:

1. Visit the branch that holds your loan, the HP State Cooperative Agriculture and Rural Development Bank branch or the Kangra Cooperative Agriculture and Rural Development Bank branch where the account sits. Carry your loan passbook or account number.
2. Ask the branch manager whether your account appears in the interest subvention list being prepared under the scheme, and ask for the outstanding principal and outstanding interest to be stated separately in writing.
3. Submit the settlement paperwork the branch asks for, which will typically include your Aadhaar, the jamabandi of the mortgaged land, your bank account details and a signed one-time settlement undertaking.
4. Pay your share, the principal and the remaining 50 per cent of the interest; on the schedule the bank sets under the settlement, and obtain a no-dues or settlement letter once the account closes.
5. Confirm the mortgage release on the land record, so that the auction proceeding against your holding is withdrawn and the encumbrance on the jamabandi is cleared.

If your branch tells you the account is not on the list and you believe it should be, put the request in writing to the branch and to the head office of the bank concerned, attaching the loan account statement. A written representation is what creates a record; a counter conversation does not.

What does the scheme actually save a farmer?

The saving is proportional to how long an account has been overdue, because that is what determines the interest pile. On an overdue agricultural loan the interest component frequently grows to a substantial share of the total dues, and it is often the interest — rather than the principal, that makes settlement impossible for a small farmer. By taking half the interest onto the state's books, the government reduces the settlement figure the farmer has to find.

The state's own framing is that the scheme will facilitate loan regularisation, reduce financial stress and let farmers continue farming without losing their land. The Chief Minister's stated reasoning was that farmers are the backbone of the state's economy and their welfare remains the government's foremost priority.

The Rs 50 crore provision against roughly 6,356 beneficiaries works out to an average state contribution in the region of Rs 78,000 per farmer, though individual amounts will vary widely with the size and age of each overdue account. Treat that as an arithmetic average of the two published figures, not as an entitlement: no per-farmer benefit figure has been notified.

Why might a farmer miss out on the interest subvention?

• The account is not with either of the two named cooperative banks. This is the single biggest exclusion, and there is no route to bring a commercial bank loan into the scheme.
• The loan is not classified as an agricultural loan in the bank's own records, even where the borrower is a farmer.
• Outstanding above the Rs 3 lakh ceiling, which limits or removes the relief.
• Refusal to complete the one-time settlement. The relief only lands when the settlement is executed; it is not an unconditional interest waiver applied to a live defaulted account.
• Branch records not updated. A wrong address, a dead mobile number or a mismatched name means the branch cannot reach the borrower when the list is being finalised.
• Death or transfer of the borrower without the legal heir formally taking the loan account over.

Where do I raise a grievance about this scheme?

• Your loan branch first, in writing, quoting your loan account number.
• Head office of the lending bank. The HP State Cooperative Agriculture and Rural Development Bank or the Kangra Cooperative Agriculture and Rural Development Bank: if the branch does not respond.
• CM Helpline 1100, the Himachal Pradesh government's citizen helpline, and the state's e-Samadhan grievance system, for a complaint against a government department.
• Registrar of Cooperative Societies, Himachal Pradesh, which supervises cooperative banks in the state.

What has not been published yet

Being direct about the limits of this guide matters more than filling the page. The following details of the Himachal Pradesh Agriculture Loan Interest Subvention Scheme had not been published in an official notification or on a state portal at the time of writing:

• The cut-off date on which a loan must have been overdue to qualify.
• Whether the Rs 3 lakh ceiling applies to the original sanctioned amount or to the current outstanding.
• The window within which a borrower must complete the one-time settlement.
• Any separate application form, portal or last date for farmers.
• Whether interest already paid on a settled account can be reimbursed.

Everything stated above about amounts, banks, beneficiary numbers and outlay comes from the Chief Minister's announcement as reported in late June 2026 and is consistent across those reports. For anything beyond that, the branch holding your loan is the only reliable source, and it is worth asking them for the departmental circular in writing rather than relying on a verbal reading of the rules.