Note ban effect in Maharashtra: Cabbages worth Rs80,000 sold for Rs6,000
Lakhs of farmers in rural Maharashtra are facing the brunt due to demonetization as the cash crunch has led to a drop in prices of farm produce. Majority of agriculture markets in the state that have so far been dealing solely in cash, were working at only 50 % or less of their capacities this monthUpdated: Dec 05, 2016 00:22 IST
If Sanjay Gunjal’s one acre of cabbage field had just ripened before the decisive November 8 decision by Prime Minister Narendra Modi to scrap high value notes of Rs 1,000 and Rs 500, he would have been contended farmer today. Instead, the cabbage took a tad longer and by the time a deal was made the agriculture market was reeling under a cash crunch that slashed prices of all farm produce.
When Gunjal, a farmer from Khandgaon village in Ahmednagar district finally sold his cabbage, he got only Rs 6,000 for the entire acre of produce instead of Rs 80,000, the market price he could have got earlier.
On the heels of three consecutive droughts and unseasonal rains, Gunjal and his family was counting on this cabbage field to make some headway in 2016. ``The money I would have got from the cabbage would have gone into planting of pomegranates in this season, paying back one installment of loan, running the house and paying labourers. Now, I have been left with half a field of cabbage that even the trader did not bother to take and will have to plough over it,’’ said Gunjal, whose family including two other brothers owns 16 acres of land, where they grow vegetables, sugarcane and fodder crops.
Like Gunjal, lakhs of farmers in rural Maharashtra are facing the brunt due to demonetization as the cash crunch has led to a drop in prices of farm produce. Majority of agriculture markets in the state that have so far been dealing solely in cash, were working at only 50 % or less of their capacities this month.
With the district co-operative banks, where a majority of farmers have their transactions, not getting enough cash from the state banks, currency has only a notional value even for the relatively well to do sugar cane farmers, as they cannot withdraw money from their accounts. The result is that the entire cycle of transactions in the farm sector from commissioning agents to landless labourers, has been disrupted.
`` My farm labourers have to be paid weekly in cash. I owe them Rs 20,000 already. I have had to let go of sowing in this rabi season because there was no money in hand. I lost 60 per cent of my last onion produce in the rains. The remaining 40 per cent or 100 quintals I brought to the market but traders have no money to pay me, ’’ said Namdeo Karade, farmer from Ahmednagar in Western Maharashtra. ``I have sold my entire produce on trust to a trader; he will pay me when the cash is handy in a couple of days. I have never been paid in cheque before, what if it bounces?’’
At the Sangamner’s APMC, traders and agents owe farmers like Karade nearly Rs 5.72 crore in the last 15 days. At the Ahmednagar APMC, that makes a profit of Rs 9.4 crore, nearly Rs 12.10 crore is pending in payments to farmers in the 14 days from November 8 to November 26.
``We are functioning at 50 per cent of our capacity.. the cash crunch has slashed all prices especially of fruits, vegetables by 30 to 40 per cent. But, cheque payments have slowly started with 35 to 40 per cent of payments being done in cheques. It is going to be slow but the shift can be made as all farmers do have bank accounts. The problem is that clearance of cheques can take as much as 10 days,’’ said Abhay Bhise, secretary of Ahmednagar APMC.
By the time the shift to cheque payments is 100 per cent and farmers can actually get their hands on their hard earned cash, the rabi sowing season will be over. In this shift, many a small farmer, will be hit so badly that it will take him another year to recover, that too only if the monsoons are good.
Rajaram Akolkar for instance is among those, who says, survival will be difficult. Akolkar drove on his motorcycle 53 kms from the drought prone Pathardi taluka to come to APMC in Ahmednagar, carrying with him one quintal of lemons, seeking a better price. He was however offered only Rs 8 for a kilo of lemons and he can return home with Rs 800, but this pricely sum includes one old Rs 500 note.
`` I have no choice but to accept Rs 800 being offered to me, including one old Rs 500 note, stand in a queue to deposit the money and withdraw it. I have a Jan Dhan account in a nationalized bank but the branch is away from my village and will cost me one day’s work. I need the cash now,’’ he asked. After demonetization, Akolkar was forced to abandon his 200 bags of onions in local market at Pathardi, for the lack of buyers. In APMCs, farmers like Akolkar sitting on gunny bags of produce from ginger to carrots, hunting for buyers and finally abandoning produce is not uncommon.