Considering the high incidence of farmers’ suicides in Punjab, the state government has decided to introduce a much-awaited draft legislation in the assembly’s budget session that makes it mandatory for ‘arhtiyas’ (commission agents) to get themselves registered. The Punjab Agricultural Indebtedness Bill also provides for complete annulment of compound interest, besides fixing the rate of simple interest imposed on indebted farmers at not more than 12% per annum.
At a press conference here on Wednesday, agriculture minister Jathedar Tota Singh confirmed the Akali-BJP government’s move to introduce the bill in the budget session, scheduled in March 2016.
The bill, drafted back in 2005, was the outcome of the state government’s undertaking in the Punjab and Haryana high court that it was in the process of regulating the private money lending system, which was one of the main reasons for farmers’ heavy indebtedness due to compound interest as high as 32%.
The bill also provides for the constitution of debt reconciliation boards at the subdivision level, headed by local subdivisional magistrates (SDMs), to adjudicate upon disputes related to loans and advances raised by farmers from ‘arhtiyas’, who have been doubling as money-lenders, said a review note that is set to be listed as one of the reasons for tabling the bill in the Vidhan Sabha.
It also puts the onus on ‘arhtiyas’ to prove that the loan money has actually been extended to the farmer and the rate of interest on the capital amount does not exceed 12% per annum.
The passage of this bill has been a long-standing demand of various farmers’ unions and organisations and was also part of the 18-point agreement signed between chief minister Parkash Singh Badal and farmers’ organisations earlier this year.
“Suicides by farmers is a serious issue. The chief minister wants this bill passed in the coming budget session,” the minister said.
A senior official, however, said on the condition of anonymity that the clause on fixing 12% rate of interest was still being debated upon by ministers.