Government on 11 September 2012 reduced interest rates on rescheduled crop loans from 12 to 7 per cent in drought-affected areas for this fiscal. It also increased the number of guaranteed work days under the MGNREGA to 150 days from 100 days.Four Indian states namely Karnataka, Gujarat, Maharashtra and Rajasthan have declared drought in more than 390 taluks.
During agrarian crisis, crop loans get converted into term loans for a longer period of three years but at a higher interest rate of 12 per cent.
The Empowered Group of Ministers also approved 846 crore rupees to Karnataka, Maharashtra, Gujarat and Haryana under the National Rural Drinking Water Programme, and relaxed some norms.
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