Task Force on agrarian distress submits draft of Farm Credit Policy to CM

* Proposes a variety of measures including plan for ‘moneylender-free village’, special tax to raise funds for strengthening agriculture, and special Farm Debt Tribunals in each tehsil 

Staff Reporter 

Vasantrao Naik Sheti Swavalamban Mission (VNSSM), set up by Government of Maharashtra to monitor implementation of the relief packages for farmers in six suicide-affected districts of Vidarbha a few years ago, has come up with a draft report on ‘Farm Credit Policy’. The re-constituted VNSSM, in its draft report submitted to the Chief Minister, has suggested a slew of measures including restoration of farm credit and advancing the farm credit distribution schedule. 

Restoration of farm credit, and advancing of farm credit supply schedule to bring all farmers in the net of banking (institutional) credit by April 2016 have been set as the ‘first goal’ of the draft Farm Credit Policy. “Currently, only 20 per cent of farmers are getting credit through banking network, and this coverage has to be widened to 100 per cent. Further, all needy farmers should get farm credit on priority before the start of the agricultural season of Kharif. For the purpose, farm credit schedule has to be advanced to start from April 1 and end by May 15, from the year 2016. VNSSM has set this as the first goal,” farm activist Kishor Tiwari, President of VNSSM, told ‘The Hitavada’. 

Devendra Fadnavis, Chief Minister, has tasked VNSSM with suggesting measures to prevent farmers’ suicides. The draft report incorporates the recommendations of National Commission on Farmers (NCF) chaired by eminent scientist Prof M S Swaminathan, and a committee headed by noted economist Dr Narendra Jadhav. VNSSM has extended its ‘strong support’ to all the recommendations of these committees. 

NCF had recommended expansion of outreach of formal credit system to poor and needy, reduction in rate of interest for crop loans to simple 4 per cent, moratorium on recovery of debt including loans from non-institutional sources and waiver of interest in distress-hotspots and during calamities, establishment of Agriculture Risk Fund to provide relief to farmers in the aftermath of successive natural calamities, issuance of Kisan Credit Cards to women farmers, expanding crop insurance cover to entire State and all crops with reduced premiums, creation of Rural Insurance Development Fund etc. 

Dr Narendra Jadhav Committee had recommended reorganisation of rural financial institutions and making them socially more sensitive. The panel had also recommended setting limit and advancing loans, using average cropping pattern for five years instead of prevailing annual cropping pattern. 

Taking a cue from these recommendations, VNSSM has suggested in its draft Farm Credit Policy that a ‘moneylender-free’ village concept should be implemented. Under the plan, at least one person from each family should become a member of self-help group (SHG) in respective village, and every rural and semi-urban branch of each bank should adopt one village in respective jurisdictions. SHG being a source of institutional credit, each family in rural area will get financial inclusion cover. Within three years, Tiwari said, a village can be made free of borrowings from moneylenders. 

An extensive ‘farm debt and fresh farm credit’ data should be collected and compiled covering all villages and farmers, so as to draw plans for effective implementation of the Farm Credit Policy proposed. While doing so, VNSSM has urged the State Government to scrap the present-day crop loan policy. Instead, Tiwari said, VNSSM has proposed a five-year crop loan policy covering necessities of farming and personal priorities of farmers like ward’s education, expensive critical healthcare, daughter’s marriage etc. There should be flexibility of repayment of loan by the end of five years. 

Village committee, Talathi, Gram Sevak, co-operative society secretary, service area Bank Manager will have to prepare micro-level farm debt data, enlisting the current debt-burden on farmers and admissible fresh crop loan amount for a period of five years, depending upon their land holding. 

Other measures suggested by VNSSM in its draft Farm Credit Policy include special taxation to strengthen agriculture so as to support the State in raising funds. Within next three months, such taxation should be announced and a ‘bailout package’ be proposed, it states. Tiwari said that setting up special Farm Debt Tribunal in each tehsil would help in disposal of matters relating to debt from private moneylenders, and faster disposal will reduce discontent among farmers. Besides, the farmers’ suicides should be investigated and cases based on agrarian and extreme distress should be made admissible for all social security network and extensions, he stressed. 

{04-09-15}