At Rs 2.95L, Punjab has highest per farmer institutional debt
Ruchika M Khanna
Chandigarh, August 9
The per farmer institutional debt in Punjab is the highest in the country at Rs 2.95 lakh. As many as 24,92,663 farmers have taken loans worth Rs 73,673.62 crore from commercial, cooperative and regional rural banks.
This loan is in addition to loans taken by farmers from non-institutional sources like private money lenders and commission agents. There is no estimate of the loan taken from non-institutional sources at exorbitant rates of interest but agro economists say that this category of loan should be much less than the institutional loans, because of the interest subvention schemes offered by banks lately. However, it is estimated that the combined loans could well be over Rs 1 lakh crore.
Total debt
Rs 73,673cr on farmers in the state
Haryana at number 3
Gujarat has the second highest per farmer institutional debt of Rs 2.28 lakh in the country, followed by Haryana at Rs 2.11 lakh and Andhra Pradesh at Rs 1.72 lakh
The data, released by the National Bank for Agriculture and Rural Development, and laid in the Lok Sabha by the Minister of State Finance on Monday, reveals that 21.42 lakh farmers have taken loan of Rs 64,694 crore from commercial banks, 50,635 have availed loans of Rs 1,130 crore from cooperative banks while regional rural banks have advanced loans worth Rs 7,849.46 crore to 2.99 lakh farmers. This also shows that while the maximum agriculture advances (Rs 1.47 lakh crore) have been made in Rajasthan, the per farmer institutional debt is highest in Punjab.
Gujarat has the second highest per farmer institutional debt of Rs 2.28 lakh followed by Haryana at Rs 2.11 lakh and Andhra Pradesh at Rs 1.72 lakh.
Not getting good returns on produce
To maintain high produce, farmer increases his input cost substantially, mainly by taking loans. However, he is not getting the return on produce through the MSP and again takes loan to meet his expenses. —Sukhdev Singh Kokrikalan, General Secretary of BKU ekta ugrahan
“This increasing debt on Punjab farmers will only add to their financial woes. There is fear that it may lead farmers toward economic ruin and could contribute to the rising cases of suicide because of high indebtedness. The government must take a serious view of the issue,” said economist RS Ghuman.
He added that what was making matters worse was that the loan was advanced to farmers not based on the value of crops (which is their repaying capacity) but based on the value of their land.
Farmer suicides in Punjab because of high indebtedness and inability to clear their debts are among the highest in the country. It was thus that the previous Congress government had brought out a crop loan waiver scheme. Though the Congress rode to power in 2017 on the promise of debt waiver for farmers, it could waive and give relief to only 5.84 lakh farmers, by waiving debt worth Rs 4,624 crore. Now, there are high hopes from the Agriculture Policy that the state’s Aam Aadi Party is promising to bring to alleviate farmers from their economic suffering.
