WHILE JAITLEY AND RBI FIDDLE FOR CORPORATES, FARMERS OF COUNTRY INTENSIFY THEIR STRUGGLE

09 August 2017
THE states going in for farm loan waivers will have to generate funds from their own resources, Finance minister Arun Jaitley has threatened after a meeting with public sector bank (PSB) chiefs. His threat come in the backdrop of farmers’ agitations across the country as well as state governments such as Maharashtra and Uttar Pradesh - both BJP-ruled - announcing farm loan waivers. There are also similar demands for farm loan waiver in States, including in Madhya Pradesh and Haryana, Punjab, Tamil Nadu and from almost all states. To say it is a domino effect of the loan write-offs for small and marginal farmers by the UP government may be simplistic. In TN, they have given the state government two months to meet their demand for a full waiver or face a fresh agitation. Maharashtra Chief Minister, in the face of protracted protests by farmers, has announced a blanket loan waiver for ‘needy’ farmers, with an estimated outgo of Rs. 35,000 crores. In MP, the chief minister has resisted announcing a waiver, but unveiled a ‘package’ that includes a ‘settlement scheme’ to bring loan defaulters back into the credit net with interest-free loans. Farmers in Punjab also began dharnas on 12th June for loan waivers and other interventions. It is in this situation the central finance minister has categorically said states must generate their own resources to fund such largesse, and the Reserve Bank of India has warned of inflationary risks from fiscal slippages caused by large farm loan waivers. But when almost 12 lakhs crores of ‘bad loans’ due from corporate houses like Adanis, Ambanis, Mallyas were written off by public sector banks none of them had raised any such objections. Only when the question of writing off loans of farmers which comes to only 10% of the largesse shown to corporate houses, such objections is raised.

There is deflation in pulse and vegetable prices. Similar is the case with many other agricultural produces. Though it is not much reflected at markets which are increasingly controlled by corporates, the farmers do not get remunerative prices. Though Modi, during his election speeches had assured implementation of M S Swaminathan Commission report which calls for fixing the minimum purchase/support price at actual expense of farmer plus 50% extra, it was never implemented. Demonetisation had its own negative impact. Now the new cattle trade rules threaten the viability of livestock and dairy farming. Though banks are awash with funds since the note ban, rural lending growth collapsed to 2.5% in the second half of 2016-17 and even shrank in several states. Prices of fuel used by rural households have surged for three successive months. It is this squeeze on them from several fronts which have pushed the farmers to the brink. Increasing number of them has resorted to suicides. The spiraling farmers struggle broke out as a result. Threats and state terror cannot deter the farmers from their struggle. 
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