Punjab Mandi Board in dire straits as RDF not released by Centre yet
The Punjab State Agricultural Marketing Board, also known as the Mandi Board, is facing a severe financial crunch as the rural development fund (RDF) charged by the state government on grain procurement has not been released by the Centre for the rabi season (wheat harvesting) yet.
Also, the fund amount for the last year’s kharif season 2020 has been curtailed. The Centre owes Punjab ₹760 crore RDF for the rabi season and ₹500 crore for the 2020 kharif crop when only 1% accrual was allowed against 3% charged by the state government.
In the absence of funds, loans raised by the board are piling up and development works, particularly in the rural areas of Punjab, have come to a halt.
The worries of the once cash-rich board, which funded a variety of expenditures of the state government, are mounting as the Union food and public distribution ministry is in no mood to release the funds anytime soon. As a result, loans to the tune of ₹3,000 crore, including ₹120 crore in interest, have piled up for the board.
The loans are part of the ₹3,976 crore raised by the board by pledging future fund accruals for the state government’s debt waiver scheme launched in 2018.
“We have no funds to repay loans and start development works,” said a board officer.
The RDF is managed by the rural development board which has chief minister Capt Amarinder Singh as its ex-officio chairman. The upkeep of nearly 66,000 kilometre roads in the rural belt is done from the fund.
“Our coffers have dried up as we don’t have funds for future works and to service the debts. We are supposed to pay half-yearly installments to repay debt. Our last installment of ₹325 crore was paid by the state finance department,” said the board official.
The board had availed loans for waiving ₹4,600 crore as debt of 5.5 lakh farmers as part of the state government’s farm waiver scheme with ₹1,800 crore still pending. Also, ₹520 crore is to be paid to 2.85 lakh landless labourers.
To repay the loans raised by pledging RDF, ₹26 crore is given on monthly basis and ₹625 crore after every six months.