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Farmers

  • With loan waiver, substantial line of credit has opened up: Pawar

    Upbeat after the loan waiver for farmers, Union Agriculture Minister Sharad Pawar on Saturday said there was no hurry to hold general elections. Denying that the loan waiver was meant as a pre-poll move, he told reporters, "Let us stay in power for another 14 to 15 months.'

  • "Root cause not addressed'

    The Union budget's proposal for clearing the indebtedness of small and marginal farmers is ad hoc. It does not aim at removing the root cause of farmers' deprivation, which is lack of remunerative price for their produce, Subramanian Swamy, Janata Party president said. Describing the budget as "hotch-potch retrograde,' Dr. Swamy said it lacked vision, strategy of reforms or direction. The claims of the Finance Minister on accelerating growth in gross domestic product, output of food grains, institutional credit for agriculture and performance under the Bharat Nirman were misleading as the Economic Survey 2007-2008 revealed the contrary. Besides, "there is no long-term scheme for desperate farmers committing suicide, salaried persons "suffering from inflation,' small and medium industries "suffocated' by globalisation and for stabilising the "volatile' stock market.

  • No relief for farmers in informal sector

    They are indebted to moneylenders and middlemen, and pay huge interest Finance Minister P. Chidambaram on Friday unveiled a Rs.60,000-crore debt waiver and debt relief scheme for four crore small, marginal farmers and other institutional loanee farmers. But his proposals did not indicate any provision in the Agriculture Ministry's budgetary allocation, nor was there any explanation on resource mobilisation for the one-time waiver. The Minister later said the government would provide the banking sector liquidity, equivalent to the amount being written off, over three years. The budget ignored 42.3 per cent farmers in the informal sector who are indebted to moneylenders and middlemen and pay phenomenal rates of interest. Their debt stood at Rs. 48,000 crore in 2003 and a majority of farmers who committed suicide borrowed from the informal sector after becoming defaulters in the banking system. No new scheme Nor has any new scheme been announced in this year's agriculture budget. In fact, there have been cuts in the allocations for the National Crop Insurance Scheme and the pilot weather-based crop insurance scheme. At the same time, the Minister did not give in to the wide-scale demand for reduction in the institutional interest rate on farm loans from seven to four per cent. Announcing the never-before debt waiver scheme, Mr. Chidambaram said it was a measure of expressing the nation's gratitude to the farming community. All agricultural loans disbursed by scheduled commercial banks, regional rural banks and cooperative credit institutions up to March 31, 2007 and overdue as on December 31, 2007 will be covered under the scheme. For small and marginal farmers with a holding of up to two hectares, there will be a complete waiver of all loans that were overdue on December 31, 2007 and which remained unpaid till February 29, 2008. OTS for others In respect of other farmers, there will be a one-time settlement (OTS) scheme for all loans that were overdue on December 31, 2007 and which remained unpaid till February 29, 2008. Under the OTS, a 25 per cent rebate will be given against payment of the balance of 75 per cent. The agricultural loans restructured and rescheduled by banks in 2004 and 2006 through special packages and other loans rescheduled in the normal course as per the reserve Bank of India guidelines will also be eligible for either waiver or the OTS on the same pattern. The total value of the overdue loans being waived is estimated at Rs. 50,000 crore and the OTS relief, at Rs. 10,000 crore. Over three crore small and marginal farmers and about one crore other farmers will benefit from the scheme. The farmers, after being granted debt waiver or on signing an agreement for OTS relief, will be entitled to fresh loans from banks in accordance with normal rules

  • Farmers' Day on March 5

    The Nuclear Institute of Agriculture Tando Jam is organising Farmers' Day here at the Institute on March 5. In this respect, the Institute has arranged a joint gathering of farmers and agriculture researchers where Dr Abdul Rashid Member Biosciences and Dr Mazhar H Naqvi Director General Agriculture and Biotechnology of Pakistan Atomic Energy Commission will deliver speeches on the role of PAEC in agriculture. Copyright Associated Press of Pakistan, 2008

  • Farmers' Day on March 5

    The Nuclear Institute of Agriculture Tando Jam is organising Farmers' Day here at the Institute on March 5. In this respect, the Institute has arranged a joint gathering of farmers and agriculture researchers where Dr Abdul Rashid Member Biosciences and Dr Mazhar H Naqvi Director General Agriculture and Biotechnology of Pakistan Atomic Energy Commission will deliver speeches on the role of PAEC in agriculture. Copyright Associated Press of Pakistan, 2008

  • Do more for farmers

    Union finance minister's Rs 60,000-crore loan waiver in the Union Budget proposals has won kudos for the government and has to some extent queered the pitch for the Opposition on this score. But a lot more needs to be done if the Congress-led UPA government has to regain the confidence of farmers. Bank loan is just one minor part of the problem and concerns only those farmers who take loans from banks. There are millions of farmers who take loans from moneylenders and commission agents at usurious prices. Maybe the government could issue an ordinance to stop payment on these loans, because in most cases the interest amount is more than double the actual loan. Even in the case of the farmers whose loans with banks have been waived, fresh trouble will begin next season. The crux of the problem which any farmer from Hoshiarpur to Wardha or Warangal will tell you, is remunerative price. Unless he gets remunerative prices, he will be in debt to the banks again. And what about corruption? A farmer from Hoshiarpur, for instance, if he wants to buy a tractor which costs say Rs 5-6 lakhs, has to pledge his four acres of land in addition to the ten per cent interest he pays on the loan. When he pledges his land he has to deal with the patwari and senior revenue officials. He has to bribe them to get his work done. Then he has to look for a middleman and pay him to negotiate to get his loan from the bank and finally at the bank he has to grease the palms of officials sanctioning the loans. On Rs 4 lakhs he pays over Rs 4,000 as bribe, and this is the minimum. The other important issue is cost of production. The government gives the farmer what it calls his cost of production. Perhaps the bureaucrats use their own parameters to arrive at the cost of production, but the farmer needs to survive. The businessman, for instance, adds his profits and perks to the cost of the items he produces. Shouldn't the farmer get a reasonable profit? He and his family work 24 hours, seven days a week, 365 days a year on their farm. In Maharashtra, farmers wait all night for power to run his pumps. And yet his cost of production does not take all this into account. This bias against the farmer must be removed.

  • Congress plans rallies to cash in on farm debt waiver

    Buoyed by the popular reaction to the farm debt waiver and debt relief scheme announced in the budget, the Congress has planned a series of rallies in State capitals and district headquarters. It will begin with a massive show of strength on the Ramlila grounds here on March 9. At the same time, Congress president Sonia Gandhi will meet State-wise all-party MPs from March 3 to 5 in the Parliament House. In a bid to pull out all stops to cash in on the popular sentiment, Ms. Gandhi's meetings with MPs will generally carry the message that the momentum and high ground gained by the party on the farmers' indebtedness issue, should be maintained throughout the year when six States go to the polls, and till the Lok Sabha polls next year. The States going to the polls this year are the ones where farmers would benefit the most from the Rs.60,000-crore debt waiver scheme. These are Karnataka, Rajasthan, Madhya Pradesh, Chaattisgarh, Delhi and Jammu and Kashmir. A senior party leader said that the mood in the party is upbeat and the leadership wants it to be sustained. Central to Ms. Gandhi's meetings with MPs would be the message that the programmes launched by the Congress-led UPA government should be "properly explained' to the people. In particular, the Congress would like to take the credit for the National Rural Employment Guarantee Programme and now the farm debt relief issue, the sources explained. On Monday, Ms. Gandhi will meet MPs from Andhra Pradesh, Assam, Bihar, Manipur, Meghalaya and Arunachal Pradesh. On Tuesday, she is to meet MPs from Jammu and Kashmir, Himachal Pradesh, Delhi, Karnataka, Kerala, Tamil Nadu, Puducherry, Haryana, Punjab, Chandigarh, Uttar Pradesh and Uttarakhand. On Wednesday, the Congress president will meet MPs from Madhya Pradesh, Rajasthan, Gujarat, Goa, Dadar Haveli, Daman and Diu, West Bengal and Andaman and Nicobar. The AICC has planned the rallies keeping in mind the hundreds of Congressmen who want to "thank' the Congress president for the decision on the debt relief scheme.

  • Budget a panacea for small farmers: Bansal

    2 "The budget will go a long way in solving the problems of the small farmer,' said Pawan Kumar Bansal, Minister of State for Finance, while speaking at a seminar, "Agriculture

  • Farm loan waiver via cash, bonds

    HERE'S the answer to the most intriguing question about this year's budget

  • Will loan waiver address farm distress?

    It will provide only short-term relief THERE arefour crore small and marginal farmers who are unable to repay their crop loans to the banks. The Rs 60,000-crore budgetary allocation for waiving their loans will now enable a farmer to go back to the same bank, apply for another loan and await either of these two outcomes: a good crop or another loan waiver. While the gesture provides farmers relief in the short term, it would be harmful for the economy, especially the farm economy, in the long run. If we take the risk versus reward incentive out of an economic activity such as agribusiness, the enterprise quotient diminishes and hinders both growth and innovation.These key attributes, along with structural reforms and investment in agri-infrastructure, are needed to raise agricultural productivity and maintain the growth trajectory of the economy. The question we need to ask ourselves is why these farmers have not been able to repay their crop loans. Can Rs 15,000-per-farmer reward help them produce a better crop in the next season? The answer sadly is No. Small farmers face two main challenges: meeting their input needs (seeds, pesticides) and dealing with the weather risks to their crops. Issuance of input coupons for purchase of quality inputs for the next season would have been more beneficial. Bad weather plays havoc with agriculture. Dealing with weather risk calls for appropriate risk management tools such as weather insurance. This requires a network of weather stations at the block level for timely collation of data, a basic requirement for weather insurance products. Establishing a network of weather stations would have required only a fraction of the Rs 60,000 crore outlay. The budget will definitely encourage the creation of rural enterprises such as nurseries and cold chain establishment. The one-time budgetary assistance of Rs 75 crore for setting up mobile soil testing facilities is also a good step. However, the provision of Rs 60,000 crore for loan waiver which can at best provide short-term relief to farmers has robbed them of possible agri-infrastructure projects such as roads, marketing and storage facilities, and irrigation which could have yielded better returns on a sustainable basis. (*Country Head, Food & Agribusiness Strategic Advisory & Research) RAKESH TIKAIT Spokesman, Bhartiya Kissan Union It will not solve the deepening agri crisis THE Union budget 2008-09 is prima facie a pro-farmer budget, with the primary emphasis on writing off the loans of small and marginal farmers. It is a good step to provide instant relief to farmers who are heavily indebted, although it covers only 40% of total farmers. However, the debt relief will not solve the deepening agrarian distress. Nevertheless, we see the announcement of debt waiver as a victory of farmers' union, activists and pro-farmer media. It was a great battle and we are grateful that the finance minister took this step despite corporate pressure. We believe that this measure alone is not enough to address the farmers' problems. It is well known that the basic problem faced by farmers is their inability to get fair price for their produce. The policy makers have said nothing on this count. Nothing has also been said about ensuring better farm gate price for agriculture commodities or making available a price stabilisation fund to help farmers increase their income. The price offered for the commodities produced by them must not only fully cover their cost of production but also ensure livelihood security. Subsidy is another area of concern. Traders and producers are currently getting all the benefits while farmers have to suffer due to scarcity of fertiliser. The budget has also not made any announcement to strengthen the extension services of the ministry of agriculture to make it more relevant for the farmers. As a result, farmers are forced to depend on agents of pesticide and seed companies for technical advice. It seems that the government has made up its mind to hand over this system to the corporate sector. In this context, we are closely watching the Indo-US knowledge agreement and the multinational companies in seed business. In conclusion, although the budget is pro-farmer, the actual need of the Indian farmer is not just the removal of debt and interest. Many other important issues need to be addressed. These include access to market, fair price for produce, timely availability of fertilisers and seeds, direct subsidy and the public sector investment in agriculture business. We hope the government will consider all this in future. And the main need is to keep corporates far from farming business. K CHAKRAVARTHY Country Head* YES BANK

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