6000 coffee growers in K’taka stand to lose plantations over unpaid loans
Owe over ₹500 crore to banks: Report
Bengaluru: Nearly 6,000 coffee growers across Karnataka’s key coffee-producing districts—Kodagu, Chikkamagaluru, and Hassan—are at risk of losing their plantations, as the deadline for repaying loans ended on Monday.
These growers collectively owe over Rs 500 crore to various banks in Karnataka. With the deadline under the one-time settlement (OTS) scheme now expired, banks are preparing to recover their dues by auctioning the plantations under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, as reported by Deccan Herald on Tuesday.
Though coffee crop loans are not covered under SARFAESI, loans taken for plantation development attract penal action. Various banks have already issued auction of property notices to coffee growers in Chikkamagaluru and Kodagu districts.
“Thousands of coffee growers in Karnataka who have taken loans for various development activities over the past many decades, have defaulted to banks and the total amount left unpaid has now swollen to more than Rs 500 crore,” DH quoted M.J. Dinesh, Chairman, Coffee Board of India, as saying.
Dinesh said that they met Finance Minister Nirmala Sitharaman in November 2024 and requested a package to bail out coffee growers. She agreed to their demands and in consultation with the Finance Secretary, a one-time settlement (OTS) scheme was prepared. Under the scheme, coffee growers were offered time until June 30, 2025, to repay loans with concessional interest rates—3 percent for loans under Rs 25 lakh, and 4 percent for loans above Rs 25 lakh and up to Rs 50 lakh.
However, the uptake has been limited. Only 518 growers in the state availed themselves of the scheme.
"Coffee growers have been facing several challenges such as low yield, high cost of operation. The labour and input costs have gone up steeply over the years. It will be very difficult for small growers to repay in one or two instalments. We urge the banks and the government to extend the deadline for repayment," DH quoted Arvind Rao, a grower from Chikkamagaluru and Chairman of Karnataka Planters Association, as saying.
Dinesh stated that banks have already started sending notices to growers who missed the March 31 cutoff and will begin the recovery of loans from July 1. He further added that he plans to meet finance ministry officials in Delhi this week to request an extension of the deadline.
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Power tariffs under BESCOM to rise from May 1
Bengaluru (PTI): Power bills for consumers under the Bangalore Electricity Supply Company Limited (BESCOM) will go up from May 1, following an order issued by the Karnataka Electricity Regulatory Commission (KERC) on Friday.
The hike comes after KERC allowed the BESCOM to recover a revenue deficit of Rs 2,068 crore incurred in 2024-25, from the consumers.
As a result, for every unit of electricity consumed in 2024-25, the customers will be charged an additional 56 paise, it said.
"BESCOM shall calculate, for each of the active consumers of FY2024-25 the amount to be recovered based on their actual energy consumption during FY2024-25. Such amount shall be recovered during FY 2026-27 in equal monthly instalments, to be called as 'FY25 True up Charges', commencing from the first meter reading date falling on or after 1 May 2026 and concluding with the reading date ending on 30 April 2027," the order said.
"It is further ordered that BESCOM shall maintain a separate head of account, allocated for the purpose, to record the adjustment of the said amount to ensure full recovery of the deficit," it added.
Similarly Chamundeshwari Electricity Supply Corporation Limited (CESC) has also recorded a revenue deficit of Rs 121.71 crore and can collect an additional 15 paisa per unit for consumption in 2024-25, official sources said.
