Vines of debt

Onion or grape, farmers of Nashik in north Maharashtra have very little to choose to escape debt, and now death.

WHILE writing out the receipt for Pandurang Kadam's onion crop on April 19, the trader did not realise that it would be used as forensic evidence. The next day Pandurang returned to the Lasalgaon market and set himself on fire. The town watched in shock as Pandurang burned in the yard where a thousand farmers' hopes are extinguished every day. In his pocket, they recovered the receipt. Behind it Pandurang had written his last words.

"The cooperative society bank's Rs.23,500 still remains. Electricity bill Rs.4,000-5,000. Ashok Rs.3,000, Champalal Rs.1,000. All the onions went for Rs.151 [a quintal]. I could not pay back the loans. My prayer to the State and the Centre is that farmers must get a price of Rs.300-400. With this prayer, I end my life's journey."

It was the harvest season and Pandurang, 60, had gone to the market hoping this year would be different. It was not. He was not able to make up the last two years' losses on his one-acre (0.4 hectare) farm. "The market price was too low for him to recover any of the costs," says Sunita Kadam, his daughter-in-law, who spoke to Frontline at Somthan Desh village in north Maharashtra's Nashik district. "He had sold one bullock, the cart and even the tractor. But even that wasn't enough."

Driving through the lush green fields of Nashik district, no one would imagine that farmers here are in the red. The hilly landscape is lined with leafy grape vines reaching up to touch the sky. Lasalgaon is one of the largest markets for onions in Asia and Nashik is one of the more developed districts in Maharashtra - called India's California. But here dreams have soured. For the first time, the district reported 17 suicides by farmers. Increased production actually led to their ruin as prices crashed.

"Production and exports are reaching record highs every year. But prices are falling since there is a surplus," said C.B. Holkar, vice-chairman of the National Agricultural Cooperative Marketing Federation. "Farmers can't even recover their costs."

Onion production across India rose from 40 lakh tonnes five years ago to 60 lakh tonnes last year, says Holkar. Exports have doubled to almost 10 lakh tonnes. But prices this year are at their lowest in the past five years. It is Rs.200-250 a quintal, while the cost of production is around Rs.350-400. "The government must ensure a minimum support price for perishable goods, just as it does for wheat or oilseeds. Otherwise farmers cannot survive," said Holkar.

Several farmers took up grape cultivation. Punjaram Thakre's onion crop has been incurring losses for many years. Last year, he spent Rs.1.5 lakhs to put up a grape orchard. "In the last two years, we were not able to recover our costs on onion. I spent Rs.20,000 to grow onions, but I got back only Rs.8,000. The rate was only Rs.160 a quintal," said Thakre. "So I decided to also invest in a grape trellis. The initial cost was Rs.1.5 lakhs. Every year, you have to spend around Rs.50,000 to Rs.70,000 on pesticides, fertilizer and labour. But I got only Rs.40,000 when I sold the grapes."

Thakre's bank loans have piled up to Rs.2.5 lakhs. "I sold half an acre of land, two bullocks and the cart and my tractor and motorcycle. There's nothing left to sell, but I have not been able to repay the bank for the past two years," said Thakre.

His wife, Shantibai, could not deal with the pressure. She jumped into a well on July 1 and ended the ordeal. When we visited Punjaram, they had just completed her 11th day prayer. "For any villager, a `lakh' is a very intimidating figure. My wife had never spent even Rs.500 in her entire life, so she was very worried about how we would pay back more than Rs.2 lakhs," he said.

Though much more expensive to grow, grape crops were lucrative until two years ago. So several farmers shifted to grape farming. "In two years, the area under grape cultivation in Nashik district has doubled to 100,000 acres [40,000 hectares]. The costs of cultivation have also doubled to Rs.80,000 to Rs.90,000 an acre for grapes grown for the Indian market. [Those growing grapes for export spend more than Rs.1 lakh an acre.] But the prices have halved from Rs.10-20 a kg three years ago to Rs.6-10 now," said Balasaheb Kshirsagar of the Maharashtra Grape Producers Association.

"People switched to grape cultivation because no other crop was proving profitable. But now since there is greater production, even the price of grapes has fallen. And costs just keep rising. For instance, the price of one pesticide has doubled from last year. Farmers have to use more than 12 different types of pesticide and spray six times," said Kshirsagar. It costs Rs.11-12 to grow 1 kg of grapes, but farmers have to sell for Rs.6-10 a kg.

Until now, farmers have been able to muster up the money for such high cultivation costs because this region is more developed than others. Peasants have better access to water and credit. But as they hurtle towards bankruptcy, banks are unlikely to give them loans. "Niphad taluk has the highest amount of loans from banks. Around 87 per cent of farmers have taken loans. Credit is not a problem," said Ramdas Khedekar, Sub-Divisional Officer of Niphad. "There aren't many moneylenders here. We will never go to them. They charge 10 per cent a month," said Sakari Dargude, a farmer from Brahman Gaon village.

Dargude's 19-year-old son, Vijay, killed himself by swallowing poison in the cattle shed on April 2. "He did not want me to sell the cattle to repay our loan instalment of Rs.1.35 lakh. But without repaying, we would not get a fresh loan for the monsoon season. I didn't get a proper price for my onion crop, so I had to sell the cattle to pay back," said Dargude. "So I went and sold them without telling him. When he reached the shed and found the animals missing, he was so upset he swigged the pesticide."

Dargude sought a fixed price for the crop. "Until they give us a fixed price, we will never progress," he said. "When vegetable prices in the city go up, they create havoc to lower them. But the State [government] doesn't reduce the costs for us. When prices in the city go up, we don't get higher prices. The middlemen make all the profits. And no one bothers when prices crash during the harvest season and it is time for us to sell."

He added, "What is Agriculture Minister Sharad Pawar doing for farmers? He wants us all to be out of business and hand over the land to U.S. companies on contract."

"Why is the government willing to import wheat at Rs.1,400 a quintal but won't pay its own farmers more than Rs.800-900 a quintal? Why do city people and the media raise such a ruckus if the price of onions or tomatoes goes up?" asked Kshirsagar. "Can't they spend Rs.50 a month more for their food, so that those producing it don't starve?"