KOCHI, June 9:Struggling to cope with a spiraling agrarian crisis that has been driving hundreds of farmers to suicide, the Kerala government is now mulling a piece of legislation to institutionalise monitoring and control of farm loans and put in place support mechanisms during crop failure.
Though the idea is under wraps, top government sources say this will be pushed after the Budget Session of the Assembly. The objective, the sources said, was to do away with the current knee-jerk approach to recurring farm crises pivoting on loan waivers, moratoriums, compensations and subsidy hand outs. ‘‘The legislation would draw from similar attempts elsewhere in the country. But it will also focus on all aspects of the issue and institutionalise preemptive, control and support mechanisms,’’ the sources said.
Hundreds of debt-trapped Kerala farmers have poisoned or hanged themselves in despair over the past seven years. Some 341 farmer suicides have been recorded in Wayanad alone, one of the state’s worst affected districts. The government has already sanctioned Rs 50,000 each to 137 of the dead, and revenue officials are probing 244 more recorded farmer’s suicides there. Unofficial estimates, however put the actual toll much higher.
Ironically, four Wayanad farmers, who couldn’t cough up their loan repayments killed themselves early this week just as the Central Planning Commission team probing the crisis was going around the place. The state government has got the State Level Bankers’ Conference (SLBC) to agree to write off all farm loans upto Rs 1 lakh, besides rescheduling existing loans and providing one-time settlement options with drastically pruned interest. The Centre has chipped in with a two per cent interest waiver. The government is now also working on having the worst-hit parts declared as distressed, to avail of more sops for these areas.
But the fact is that most of the farmers who had killed themselves had availed loans not from the banks, but local moneylenders, meaning that bank loan waivers can’t be the final solution. ‘‘Official reports say about 80 per cent of the farm loans are being provided by the banks. But local newspaper reports indicate otherwise. I don’t know how to tally one with the other,’’ Revenue Minister T M Thomas Isaac admitted to The Indian Express.
The minister, significantly, added that the government still has ‘‘no idea’’ about the extent of chronic indebtedness and the total volume of farm debt in Wayanad, though it has vowed to help them get out of the debt trap.
Interestingly, this is though banks in Wayanad boast of a credit ratio well over 100 per cent, against the 46 per cent in rest of Kerala. About half the population in this hill district are farmers or farm workers, compared to the 21 per cent in Kerala. More than one-fifth of the district’s income is from agriculture, and per capita income here is already about 15 per cent lower than the state average. An overwhelming majority of the farmers here are marginal or too poor to invest in their crops by themselves, and too many don’t own the land they till.
‘‘Village moneylenders are obviously the only source of loans for them, since banks need collateral. Most landowners leasing out their land take the rent in advance, and then there is the working capital and the money to sustain their homes. Informal loans are so sought after in Wayanad that the interest often goes up to 60 per cent,’’ a bank manager remarked.
STATE OF DISTRESS
341 farmer suicides have been recorded in Wayanad alone
50% people in this hill district are farmers or farm workers, compared to 21 per cent in Kerala
20% of its income is from agriculture, and per capita income here is already about 15 per cent lower than the state average