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LATEST NEWS UPDATES | Rs 65,000cr loan waiver fails to make farmers debt-free

Rs 65,000cr loan waiver fails to make farmers debt-free

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published Published on Sep 12, 2011   modified Modified on Sep 12, 2011

-DNA

 

The Centre's debt relief scheme for the farmers has given anything but relief to the poor farmers.

Despite the Rs 65,318.33-crore Agricultural Debt Waiver and Debt Relief Scheme (ADWDRS) launched by the UPA with much fanfare in 2008, nearly 43.42 million (48.6 per cent) of the 89.35 million farmer households are still in debt.

This is the finding of National Sample Survey Organisation (NSSO) report on 'Indebtedness of Farmers Household'.

The scheme benefited only the rich farmers and their bankers while the poor farmers continue to reel under debt.

Chandrakant Salunkhe, 42, is one such farmer in the drought-hit Hattalkhindi village in Parner tehsil, Ahmednagar district.

He wanted Rs20,000 for seeds and fertilizers in 2009. He tried everything, from the local farm cooperatives to the banks, to raise the money. "They drove me mad with the paper work. And finally I was told I'd be eligible for Rs4,500 only," he says. "I was left with no recourse but the local money lender."

The class 9 dropout says he has been repaying the money every month. "But the money lender and my accounts don't tally and he insists I owe him a lot."
Salunkhe is scared that he may lose his 2.5 acres to the money lender.

The Central government has already released Rs51,340.47 crore to the lending institutions as reimbursement under the ADWDRS. In Maharashtra, the number of indebted farmer households has grown from 42.35% (2007-08) to 54.8% (2009-10).

Kishor Tiwari, leader of the farmers' advocacy group Vidarbha Jan Andolan Samiti, says that the only thing the ADWDRS did was reduce banks' non-performing assets. "The rich defaulter farmers got loans written off and could apply for fresh ones. Small and marginalised farmers remained neglected. How can schemes tailored for relief to banks do farmers any good?" he asks.

The NSSO survey confirms what critics have said all along: that creating a debt-relief package that transfers funds to banks will not lessen farmers' distress. This is because a substantial chunk of rural indebtedness occurs in the unorganised sector, which is ruled by money lenders. So, while rich farmers who can afford to access bank credit have benefited from the scheme, the poor farmer has not.

Not surprising then that the NSSO figures show how the states which have the worst agrarian crisis are also those that have the highest indebtedness among farmers.

The number of indebted farmer households is the highest in Andhra Pradesh — 49.49 lakh or about 82% of the estimated farm households in the state.
 

Dainik Bhaskar, 7 September, 2011, http://daily.bhaskar.com/article/MAH-MUM-rs-65000cr-loan-waiver-fails-to-make-farmers-debt-free-2410626.html


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