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Home / India News / Farmers want assured prices, not waivers

Farmers want assured prices, not waivers

Maharashtra was forced to announce a farm loan waiver, but goodwill for the govt is still not visible.

india Updated: Apr 04, 2018 11:26 IST
Ketaki Ghoge
Ketaki Ghoge
Hindustan Times, Ahmednagar/Nasik
Over 35,000 farmers from across Maharashtra had embarked on a ‘Long March’ from Nashik on March 6 to press for their demands.
Over 35,000 farmers from across Maharashtra had embarked on a ‘Long March’ from Nashik on March 6 to press for their demands. (Kunal Patil/Hindustan Times)

Sudam Khandbahale, a 46-year-old farmer from Mahirawani village in Maharashtra’s Nasik district, 167 km from Mumbai, hacked down his one-acre grape vineyard this month, frustrated that the plantation hadn’t borne fruit for the second year in a row.

Khandbahale’s vineyard was hit by cyclone Ockhi last year, turning his Rs 3 lakh investment to dust. He says he will harvest the last crop —tomatoes planted over an acre—in April and then quit farming. “Year after year, we are struggling against falling market prices, vagaries of climate, an apathetic government and indebtedness. Farming is all that I know but it is no longer viable. I will put up a shop, sell tea or lease out my land, but I won’t farm anymore,’’ said Khandbahale, who owns three acres of land.

In June last year, Khandbahale was one of the thousands of farmers in Maharashtra who took to the streets to protest against the agrarian crisis the state is battling. One of the central demands of the protesters was a complete loan waiver.

As supply of vegetables and milk to the cities stopped, the two-day strike forced chief minister Devendra Fadnavis to announce a farm loan waiver worth Rs 34,000 crore, a demand he had resisted since 2014.

Less than a year after the strike and the waiver – up to Rs 1.50 lakh per family – farmers remain unimpressed. In Nasik and Ahmednagar districts, which bore the brunt of the protests, farmers say the waiver hasn’t helped ease their struggle.

Bowing to pressure
The Maharashtra govt announced a loan waiver last June. Farmers say it hasn’t helped ease their struggle so far
Rs 34,000 cr farm loan waiver was announced by the state government after protests by farmers in June 2017
Rs 1.5 lakh per family cap has been put on the loan waiver. This includes principal and interest amount, crop loans as well as mid-term loans from 2009 to June 2016
The scheme had three components – besides the Rs 1.5 lakh waiver, it offered a one-time settlement option for those whose loans were
more than Rs 1.5 lakh and a cash incentive of Rs 25,000 for those who repaid loans on time
The loan waiver was disbursed through an online system after seeking applications by farmers, and syncing their data with that of the banks, using Aadhar unique identity numbers as a primary parameter
The system was hit by technical glitches and after it came to light that a majority of nationalised and cooperative banks had not seeded the data with Aadhaar accounts
So far, the government has disbursed Rs 13,580 crore to 3.532 million farmers’ accounts; 7.7 million farmers applied for the loan waiver and around 4.652 million were found eligible for the various components. Out of these, 3.038 million have applied for a full waiver and remaining for the incentive cash amount. Another Rs 10,000 crore has been budgeted for the waiver.

Khandbahale owes Rs 8.5 lakh to a bank in Nasik. He can benefit from the Rs 1.5 lakh waiver only after he pays the remaining amount he owes. “I don’t have Rs 7 lakh in hand, why would I keep incurring more debt if I had the money? I may have to sell off some of my land to make that last payment to the bank. We don’t need waivers. We can repay our loans if we get assured prices for our produce,” he said.

In Putamba village of Ahmednagar district, ground zero of the last year’s strike, farmers remain disaffected.

“The loan waiver helps banks more than us. So, the government should stop pretending they have done something big for farmers. If they want to help, then they should increase minimum support prices (MSP), procure the produce from us,” said Salim Shaikh, an onion farmer from the village, who may not be able to take advantage of the waiver. This year, his income from soyabean and onion has been minimal. He owes a nationalised bank Rs 3.5 lakh he borrowed as a mid-term loan and Rs 2 lakh as a crop loan

The government’s list of beneficiaries shows Maharashtra has 1 million farmers like Khandbahale and Shaikh who owe more than Rs 1.50 lakh to banks. Such farmers have been offered a one-time settlement (OTS)–pay off the remaining amount to the bank and get a Rs 1.50 lakh waiver. Not many farmers are in a position to take up this offer.

Shaikh’s neighbour Rajendra Dhakchaule, a marginal farmer with just two acres of cultivable land, can repay most of his Rs 1.70 lakh debt with the waiver. But his worries don’t end with this.

“I had taken a loan of Rs 3.5 lakh for a tractor and under pressure collected money from a money lender to pay off this loan. I may get some respite due to the loan waiver but that’s fleeting help. The ground situation for farmers like me is unsustainable,’’ he says, breaking down.

This year, the Dhakchaules spent Rs 56,000 to cultivate onion over an acre of land, but the family of six may not recover even the cultivation costs as onion prices have dropped to Rs 700 per quintal from Rs 3000 per quintal this January. This is an eight-month low for onions.In neighbouring Pimpalgaon village, Vijay Waghchowre, a marginal farmer who owns four acres of land, is still waiting for confirmation of the waiver from his bank.

“The waiver may help us marginally this year. But I still owe another Rs 2 lakh to a moneylender. If the government wants to help farmers, let it give us subsidies or offer assured prices for our produce.”

The BJP-led state government is counting on the goodwill of marginal farmers like Dhakchaule to help it tide over the rural discontent.

“The directives of the chief minister were to ensure a system whereby the loan waiver would be transparent, inclusive and swift. We were careful to learn from the mistakes of the past loan waiver,” said Kaustubh Dhavse, officer on special duty at the chief minister’s office, who was involved in devising the online system for the loan waiver. “There had been connivance at the level of banks, government and farmers earlier to give benefits to ineligible farmers. In our case, there is no room for such connivance because the online system does not allow for it. The waiver has offered benefit to maximum genuine farmers.’’

Goodwill for the government isn’t visible on the ground.

A section of farmers’ leaders is continuing protests for a complete loan waiver. This month, as nearly 30,000 largely tribal cultivators marched from Nasik to Mumbai, the leaders put the demand back on their agenda. This was despite a majority of the protestors demanding their rights over forest lands and not a waiver as they have no access to banks.

“As a temporary relief to farmers to overcome the current distress, a complete loan waiver is essential. That’s why we continue to flag it whenever possible. A hike in MSP is one of our main demands and the state has failed to deliver on that too,” said Ajit Navale, general secretary of the All India Kisan Sabha, involved in both the farmers’ protests.

“The loan waiver has a limited scope. Consider this, the total crop loan debt on the state’s farmers is Rs 1.13 lakh crore; the government so far has spent only Rs 13,580 crore on the loan waiver,” he said.

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