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Farm loan waiver of not much help in Vidarbha

CNN-IBN
Jul 12, 2008 at 04:20pm IST

Mumbai: Farmers in Maharashtra, a state with drought in 13 districts, are responding in different ways to the Rs 71,000 crore farm loan waiver scheme. While the Vidarbha region, in grip of a severe drought, is full of poor farmers; farmers in western Maharashtra are a lot happier.

In Vidarbha field after field is barren and there is little to show that sowing has begun. Farmers sit cooped up in their villages waiting for the rains to nourish their freshly sown fields.

They know that if the rains fail them this year then they will never be able to repay their debt.

"I haven't paid the loan installment. I used all the money I had to sow a new crop, but with no rains, everything has dried up. The bank won't issue a fresh loan till I pay the last one out, but I don't have any money," Uma Shankar Ramfal, a farmer in Waifad, Vidarbha says.

But the situation is different in western Maharashtra. The region is full of lush green fields and confident farmers. Most of the farmers here are not as heavily dependent on agriculture as Vidarbha's cotton farmers. They engage in allied activities like poultry and dairy that reduces their reliance on the monsoon.

So those who have received the partial loan waiver are confident of repaying the remaining 75 per cent debt on time.

"Delay of a week or two is okay but I want a good credit with bank. It's a matter of my reputation," Avanish Mokal, poultry farmer in Thara, Raigad, says.

So why is there such a stark contrast between the credit culture in the two regions?

Vijay Jawandhia, a well known farmers' leader, feels the entire system, including irrigation works and waivers are in favour of western Maharashtra, Which is why this region has managed to garner Rs 5000 crore under the scheme, while distress-prone Vidarbha has received only Rs 1500 crore.

And he lays the blame squarely on the political leaders.

Our Agricultural Minister Sharad Pawar has said that he himself is not satisfied with this loan waiver. And he accepts that the above five-acre farmer who is non-irrigated should be included in the loan waiver. He said that he is trying that and next year he may get included them there. So farmer will wait for next year and will not pay anything," Jawandhia says.

As one travels across Maharashtra, it doesn’t look like the waiver itself has created a tendency to default.

Farmers in Vidarbha say they may not be able to pay back loans this year. That's not because they are willful defaulters. They are only forced into default out of poverty.

In contrast, in well-irrigated western Maharashtra, farmers have a stake in the system. They are able and willing to repay, since they expect to come and use the system another day.

(With inputs from Gopika Gopakumar)

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