SAMBALPUR: A one-off loan waiver may not be a panacea for farmers in the state as the benefits won’t percolate down to real and marginal farmers. “At most, loan waiver would benefit large farmers or those with sizeable land-holdings. Instead, the government should come up with an action-plan to ensure long-term growth and development of farmers as that will enable them to pay back the loans.”

The action-plan may include setting up farm infrastructure like warehouses to store produce safely and mandies for sale, along with establishing market linkages for various agricultural produce, it is recommended.  

“A farmer has self-respect and wants to live with dignity. If he has taken a loan, there is no reason why he would hesitate to pay it back. Suicide by a farmer is a manifestation of his anguish that he is unable to pay back his dues and the resultant indignity that he has to suffer. He prefers death to public humiliation by private money lenders,” noted Ashok Pradhan, convener of the Western Orissa Krushak Sangathan Samanwaya Samiti. 

In an exclusive interview with this newspaper, Pradhan said the government should rather try to ensure that the money earmarked as loan waiver reached all small and marginal farmers and those with small land holdings. “State-owned banks always give priority to people with large land holdings. If farm loans are waived, this will benefit only the middlemen and the big fish among farmers,” he said. 

In many cases in western Orissa and elsewhere, loans are given away in the names of small farmers even though they cannot make use of the money. They leave their cheque books with middlemen, traders and rice millers. As the loans are used by these people, the waiver can only benefit the intermediaries, Pradhan noted. 

In recent months, many state governments such as Punjab, Uttar Pradesh, Karnataka and Maharashtra have announced loan waivers for farmers and there is hope other state governments will follow suit. Similar hopes are also building up in Orissa.

Under farm loans, the rate of interest is the lowest if they money is paid back within the stipulated timeframe. “Farmers always want to pay the money in time to avail low interest benefits and fresh loans. However, it is often seen that loans against most of these accounts are paid before time and fresh loans released. The middlemen close these loans before time and take fresh loans, thereby reaping the low interest benefits meant for small farmers. Here, we call this paper transactions (PTs),” Pradhan said. 

In November last, the Centre demonetised large denomination notes. However, immediately after the announcement, it was noticed that crores of rupees poured into lakhs of Jan Dhan accounts. Such massive inflows of cash to these accounts also showed that farmers do not operate these accounts and it is also that their cheque-books are not with them. As all government subsidies come to these accounts, courtesy the digital push by the Centre, and the small and marginal farmers do not operate their bank accounts, chances are that the rich get away with the money meant for others.

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