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LATEST NEWS UPDATES | Andhra Pradesh counters RBI's claims -Jinka Nagaraju

Andhra Pradesh counters RBI's claims -Jinka Nagaraju

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published Published on Aug 12, 2014   modified Modified on Aug 12, 2014
-The Times of India


In a sternly-worded letter dashed off to the Reserve Bank of India (RBI), the Andhra Pradesh government has urged the institution to not underestimate the distressful conditions prevailing in the state for the past three years, which has forced as many as 6,792 farmers to commit suicide.

The nine-page letter dated July 25, countering RBI's argument about AP reporting no cases of acute concern among farmers, has been drafted and signed by chief secretary I Y R Krishan Rao. To impress upon the RBI that has been refusing to budge from its stand either on the waiver or the rescheduling of loan issue, the AP government has asked the central bank to review the plight of farmers in the drought-prone Rayalaseema belt and the flood-hit coastal districts, before reaching any conclusion.

The chief secretary has even quoted data from reports of the National Crime Records Bureau (NCRB) to reiterate AP's claim and to stress how the recurrence of calamities year after year has resulted in a severe crisis among farmers, putting AP second only to Maharashtra in farmer suicide rate.

"As many as 2,014 self-employed agriculturalists committed suicide in united AP. The number of farmer suicides was 2,572 in 2012 and 2,206 in 2011," the letter stated, while adding how these numbers projected only half the reality and was a gross underestimation of the gravity of the situation. This, as police records (the source of these figures) only include farmers with clear land titles and do not take into consideration the suicide of tenant-farmers or those whose land parcels were in their father's name.

The government also disagreed with RBI's reference on crop-yield, which painted a rosy picture about the ?health' of agriculture in united AP. It claimed that the inference was drawn to suit RBI's convenience.

The letter, while agreeing to crop-yields being good in some cases, maintained that the lack of remunerative prices caused huge losses to farmers, nonetheless. The chief secretary also reminded the bank about how some farmers in coastal districts had to declare crop-holiday as they were unable to sustain losses.

If that's not all, the state government also drew RBI's attention to the disruption in political administration during the protracted political agitation that resulted in "paralysis of decision". Thus, no relief measure had been taken up for farmers in the last two years, it stated.

Further, disputing RBI's claim that there was no dip in production to warrant waiver or rescheduling of loans, the chief secretary said the figures clearly indicated otherwise. It pointed to a significant fall in production in the state due to distress.

"When the cultivated area under foodgrains was 21.8 lakh hectare and 21.4 lakh hectare in 2008-09 and 2011-12 respectively, the corresponding production was 56.5 lakh tonnes and 57.2 lakh tonnes. In 2013-14 when the area was 21.9 lakh hectare, the recorded production was 50.89 lakh tonnes," the letter stated in order to uphold the government's argument.

It also squarely dismissed RBI's reading of the sector based on Kisan credit card renewals and balance in the savings accounts of farmers. AP's letter pointed out that the renewals were processed as farmers were also engaged in allied activities like horticulture and livestock for a livelihood. With regard to bank balances, the letter clarified that the savings were higher only at the time of arrival of crops and slowly tapered towards the end of the season. It appealed to RBI to not use the ?seasonal rise' of savings in public sector banks as a measure to conclude that "all is well in the state".

"It can be safely said that statistics are pliable but facts are stubborn," the letter stated, urging RBI to approve the conversion or rescheduling of crop loans in the calamity-affected areas, citing the plight of farmers in these regions who are eagerly waiting for fresh loans to start work in the ongoing Kharif season.

LIST OF REBUTTALS IN LETTER

Urges RBI to not underestimate gravity of situation; pointed out how 6,792 farmers committed suicide in the last three years

Disagreed with reference on crop-yield; stated lack of remunerative prices caused huge losses to farmers

Stated how political disruptions had resulted in no relief measure being taken up for farmers in last two years

Disputing RBI's claim on production rate; stated how the figures pointed to a clear drop due to distress

Challenged RBI's reading of sector based on Kisan credit card renewals; argued they were processed for allied activities

Appealed RBI to not consider ?seasonal rise' of savings in banks as a measure to conclude "all is well in state"


The Times of India, 9 August, 2014, http://timesofindia.indiatimes.com/City/Hyderabad/Andhra-Pradesh-counters-RBIs-claims/articleshow/39908052.cms


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