Sunday, March 16, 2008

Even a loan waiver scheme not enough for Vidarbha farmers-Next step is to save farmers from another debt trap-M S Swaminathan , MP, NCF ex-chief

Even a loan waiver scheme not enough for Vidarbha farmers
16 Mar, 2008,

http://economictimes.indiatimes.com/Features/The_Sunday_ET/Special_Report

/Even_a_loan_waiver_scheme_not_enough_for_Vidarbha_farmers/articleshow/msid-2869779,curpg-4.cms


When the additional district collector and collector in-charge of Yavatmal Anil E Bansod explains that the farmer suicides in Vidarbha are not because of farm loans but possibly because they are suffering from syphilis and gonorrhoea ― both sexually transmitted disease ― the whole theory of agrarian crisis goes for a toss. For the record, Yavatmal district in Vidarbha registered 1,248 suicides in 2007. But this is not the last chapter of Freakonomics that's been applied to this region. This is the beginning...

Some 70 km away in the district of Wardha, BJP general secretary Prashant Tigavnkar ― hopeful of an Assembly ticket this time ― chuckles how he "handed out" a wonderful story to a television channel about farmer suicides and how he and his party could turn things around in a matter of weeks. After all, the BJP-Sena coalition has a majority of elected members in the region.

And then in a remote village, Pandharkawda, sits Kishore Tiwari, president, Vidarbha Jan Andolan Samiti, who has diligently made entries of the farmers who've committed suicide since 2001. Tiwari, rattles off statistics and abuses in the same tone, as he lectures a foreign documentary-maker about why bureaucrats and politicians have hidden motives behind not helping farmers. Keep that and Tiwari's modesty aside and it will be not hard to miss a big poster, which adorns his office, showing that he was awarded the most recognised activist in India, 2005, by a news channel.


So is the real farmer's voice lost in the maze of bureaucrats-politicians-activists' double-speak, vote bank politics and perhaps, overzealous approach? Or it gets silenced with them ― with traces on hanging ropes or pesticides which are used to commit suicide. There is no definitive answer. Not with the government at least, because the big Rs 60,000-crore package that it has announced from the hallowed halls of Parliament has not raised hopes ― not in Vidarbha, where around 45 farmers have committed suicide since February 29.


FIVE-ACRE PASS?


Today, in any village of Vidarbha, this is the first question that you'll have to answer, if the topic of farm loans is raised. The farmers are unsure whether the government would finally relent and increase the size of land holdings to get a full waiver. Perhaps, Kishan Vithal Rao Rahate of Pimpalkhute village didn't see any hope of this happening. He committed suicide just four days after the Budget announcement. "His hopes were dashed. He had 8 acres of land.

His total loan was Rs 45,000. He had no other means. We all have no means...," says his neighbour, Vasant Rao Sonbaji Pal. Rahate left behind an old, ailing mother, wife and two children. The family now plans to survive by working on other farmers' fields. Pal is unfazed by the extreme step that Rahate took. "I would have done the same if my son was not working in a torch factory. We've other income source. But Rahate has created a problem for us. Now no money lender will give loan to us. They never do once a farmer commits suicide in a village," says a dismayed Pal.

Vicious circle couldn't have got more complex. And this is not the story of one village. In the whole of Vidarbha, you'll find such cases in every village and the same distraught farmers.

A few kilometres away in Metikhera, it's a similar story. Last year, two farmers committed suicide in this village. This time, the collector in-charge of Yavatmal, Bansod gets his facts right. "Though 50% of the farmers in Vidarbha region may fall under the category of possessing 2 hectares land, technically, they may not get the full waiver because 2 hectares is 5 acres and 2 quintas. People are unsure and sometimes they lose all hope," he says.

As per statistics, 38,073 farmers in Yavatmal have land holdings up to 2 hectares but if you count those who have less than 2 hectares, it's 1,737. "This is true for whole of Vidarbha. We'll find it difficult to explain it to voters. We've asked our leaders. Soon the waiver will be announced for all farmers who've land holdings up to 15 acres," says Kalavati Sudhir Wakodkar, Zila Parishad head, Wardha. She believes her party head, Sonia Gandhi, will understand their plea.

However, unlike Wakodkar, the farmers of Kalam village are not hopeful. "This is a political move to divide farmers. The package is good for western Maharashtra. The farmers there have small land holdings," says Sunil Davde. He holds 45 acres land.


DE-COUPLING THEORY

The cattle market in Selu has seen an increase in the price of ox this year. The best breed can cost you more than Rs 1 lakh and on an average, a pair will come for around Rs 30,000. The reason behind the jump in prices is that the crop of soyabean has been good and it's fetching double of what it did two years ago. "In an acre, you get around 12 quintals of soyabean. The rate is up to Rs 2,000 per quintal. A profit of Rs 4,000. I hope this remains the same next year as well," says Praful Ganesh Rao Mahabole of Selu Village.

But this hope is the root cause of problem. Or so, feels Vijay Jawandhia, founder-member Sheatkari Sangathan (farmers' association.) "You know why soyabean is fetching a good price? This year, the US has given subsidy to corn farmers. In Australia, there has been a drought. Who knows it will be so next year as well. And if that doesn't happen, Kishore Tiwari's register will only swell," he says.

J L Salway, chairman, Wardha District Land Development Bank, is more critical. "What good will this loan waiver do in the long run? What we need is a price stabilisation fund. There should be an effort to see that farmers also grow staple crops. Commercialisation of agriculture wouldn't take us anywhere. Loans are an interim measure," he adds.

BANKING WOES

In Pandharkawda, the Maharashtra Bank and the State Bank of India in 2008 have disbursed around Rs 7 crore as farm loans. But an official of Maharashtra Bank is worried. The farm loan waiver may do good to farmers but for him, it has created a new set of worries. "Already there is so much pressure to disburse loans to farmers who are close to politicians, activists and bureaucrats. Now this waiver. I've received no information from the head office and already farmers are saying they won't pay. I'm at the receiving end from both sides. Soon you'll see bank officials committing suicide," he says. The SBI official promises that he won't dare to go to a village till next year.

Sayed Apijuddin, who owns 2 acres in Ghataji, is also worried. "I paid all my loans on time. I maintained a good credit history. And now this waiver. I feel cheated. If others don't repay loans, will banks give us loan anymore," he questions.

In Sonkhas Village, Shamrao Balkrishnan Sathe doesn't want to go to the moneylender but he accepts that he has taken a Rs 20,000 loan from one. "You just can't do without it. They charge higher interest rate but that's any-time money. May be I would sell my land to pay. I've heard that since a cargo hub is coming in Nagpur, people are buying land at a higher rate," he says.

That's perhaps why Abdur Rehman, superintendent of police, Yavatmal, hasn't been able to put any moneylender behind the bars. "They are local farmers. And most of the times there is no written agreement. Also, farmers generally don't complain of any atrocities," he says. As per records, till January 31 this year, there were around 385 complaints, 297 enquiries and 15 FIRs, and 71 cases were filed in courts. "We feel helpless. There needs to be a social overhaul. Effective policing comes later," says Rehman.


LIFE GOES ON...

"I don't think suicide is the last resort. What will happen to those who have small kids," asks 13-year old Sneha Nagrale, a student of Yardy English School. This is the only English-medium school you'll find between Wardha and Yavatmal.

Raveena Tekan of the same class is also aware of the suicides and feel government should do something. "The Prime Minister was to come to a village near ours. We all planned to meet him. We would've told him if he would have come," she says. The Prime Minister, however, cancelled his visit at the last moment.

If the children in this English-medium school think of meeting the Prime Minister and proving their point, Sudha Rao Bhimrao Holkar is also on the same track. Her father committed suicide last


Next step is to save farmers from another debt trap
16 Mar, 2008, 0000 hrs IST,Ishani Duttagupta, TNN

http://economictimes.indiatimes.com/Interviews/Next_step_is_to_save_farmers_from_another_debt_trap/articleshow/2869764.cms


He's best known as the father of the Green Revolution in India. More recently, Professor M S Swaminathan , MP, chaired the National Commission for Farmers and has provided a lot of valuable inputs to the government on the debt burden on poor farmers. He shared his views on the loan waiver scheme with ET . Excerpts:

Do you think that the loan waiver scheme for farmers announced in the Budget will come as a major relief?

This is a very good beginning. In fact, I'm not worried about where the Rs 60,000 crore is coming from since I'm sure that the Prime Minister and the finance minister would not have announced the scheme before looking into the details. For me, the problem faced by the farmers is an accumulated one and now a serious attempt is being made to solve it. The National Farmers Commission had also recommended a loan waiver in 2005. The steps announced in the Budget are likely to bring relief to about four crore farmers who will be freed of the debt burden by June 2008 and will become eligible again for loans.

How can the farmers be prevented from getting into a debt trap again?

That is the next challenge. For the loan waivers to be fully effective, the farmers will have to be prevented from getting back into a debt trap when they again become eligible to go back for institutional financing. The source of funds for the farmers is very important and they should be able to go to scheduled commercial banks, regional rural banks and co-operative credit institutions for loans rather than become indebted to moneylenders and traders.

Why are the farmers in regions such as Vidarbha more vulnerable than others?

When defining marginal farmers, the agro-climatic region has to be kept in mind. There has to be differentiation between well irrigated and dry farming areas. Farmers in rain-fed, dry areas such as Vidarbha and parts of Andhra Pradesh may own several hectares of land but their farm produce depends on the vagaries of the monsoon. However, in an area as dry as Rajasthan, farmers have multiple livelihoods and are not that dependent on the rains. It is therefore important to get the classification right. Ultimately, multiple livelihood opportunities alone can insulate farmers in rainfed areas from the debt trap.

What should the government's next step be towards helping indebted farmers?

The Central and state governments, with the help of the agricultural universities, should set up a technical support consortium to support indebted farmers. The banks, FIs, input suppliers and private sector should also be roped in.

The next step will be to help farmers bridge the gap between actual yield and the potential of their land with the help of technologies available on the shelf. A package that combines use of technology, friendly government policy and availability of services will help the farmers increase productivity. Besides, the farmers who benefit from the loan waiver scheme should now be able to reap benefits of other schemes such as Rashtriya Krishi Vikas Yojana, National Food Security Mission, Accelerated Irrigation Benefit Programme, National Horticulture Mission, Rural Godown and Warehousing Schemes and the National Rural Health Mission.

You have often prescribed food security for India. Will the loan waiver scheme help in achieving that goal?

It will be very foolhardy and suicidal for a country like India to forgo food security. With the loan waiver, farmers who are relieved of the debt burden will be able to produce at least an additional half tonne per hectare of foodgrain or other farm produce. This should help increase food production by about 20 mt during 2008-10. In the face of dwindling foodstocks and rising prices, the additional output will boost the food security system in our country.

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