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Government's Rs241-crore debt relief package to benefit 75,000 coffee farmers

The government has launched a relief package, which will directly address the problems of the coffee growers, especially the small growers. Commerce and industry minister today flagged off the implementation of the `Coffee Debt Relief Package, 2010' by distributing the first batch of certificates to those small coffee growers whose loans have been waived under this package.

This is the first time that the Government of India has come forward with such a sizeable debt relief package for small planters.

The implementation of the Coffee Debt Relief Package 2010 for the debt-ridden small coffee growers, will involve a total financial burden of Rs241.33 crore on the government, a government release said.

Announcing this at an interactive meeting with beneficiaries in Bangalore today, commerce and industry minister Anand Sharma said that the package would cover a total of 78,665 loaner accounts having accumulated bank loans.

Of this, 74,929 (95 per cent) are small coffee growers who will get the benefit of both waiver and rescheduling of balance amount while the remaining 3,736 (5 per cent) accounts of medium and large growers will get the benefit of rescheduling of loans. The implementation of the package is under progress, the release said.

India has around 2 per cent of global area under coffee and an average share of 4 per cent of world production with an equal share in international trade, Sharma said, India is the first to offer `Coffee Rainfall Insurance' - protection against weather risk.

"The rainfall insurance scheme so far covered only deficit blossom / backing showers and heavy rains during the monsoon period. The scheme has now been expanded to cover the losses which occur due to un-seasonal rains during the harvesting period from November to February with a graded pay back depending on the intensity of these un-seasonal rains during the current year 2010-11," he said.

During 2010, for monsoon and post monsoon coverage, a total of 15,790 coffee growers were covered with a total premium collection of about Rs2 crore, of which 50 per cent would be government subsidy. This is almost three times as compared to 5,200 coffee growers covered during the whole of previous year, the minister pointed out.

Coffee production in India in 2010 -11 is forecast at 3,08,000 tonnes. Coffee consumption in the country is growing at an annual 6 per cent annual, resulting in increase in the consumption from 60,000 tonnes during the year 2000 to 94,000 tonnes in 2008. This is expected to touch about 1,00,000 tonnes during the current year.

Over the past few years, coffee has changed from being a traditional beverage consumed mainly in South India to a beverage with a national presence, consumed in several forms and retail formats. Between 2003 and 2008, coffee consumption has grown in the non-South regions at 45 per cent while it has grown at 2.5 per cent in the southern states, he said.

The Coffee Board is actively involved in the promotion of the beverage in non-traditional markets through entrepreneurial support, setting up value chain in roasting, grinding and packaging segments by subsidy support to prospective entrepreneurs and self help groups, collectives etc.

On an average, India exported 65 per cent of both Arabica and Robusta coffee in the ratio of 65:35. During the year 2009-10, India exported 2,04,176 tonnes of coffee valued at $442.82 million (about Rs2,166.90 crore) against the target of 2,00,000 tonnes.

During the current year 2010-11, the government has issued permits for export of 1,40,517 tonnes of coffee (as of 8 September 2010), which is around 62 per cent of the target for the whole year. The export volumes are 75 per cent higher compared to corresponding period of last year, he added.