Compounding a crisis

The agricultural community, which incorporates small and medium farmers and comprises vast sections of the rural poor, has been hit hard by the demonetisation move. Caught unawares between the end of the kharif season and the peak of the rabi-sowing season and facing the prospect of another year of non-remunerative prices, the country’s farmers have begun to see an unfolding crisis. The All India Kisan Sabha, which was in the midst of a countrywide campaign in November, found farmers in despair. Excerpts from an interview with Hannan Mollah, AIKS general secretary and former CPI(M) Member of Parliament.

The AIKS campaign that culminated in a rally in Delhi coincided with the announcement of demonetisation.

We believe that Indian farmers are in severe distress, and demonetisation has added to their woes. I call it a crisis and not a problem. Forty-one per cent of farmers say they will quit farming if they have an option. Sixty per cent are severely indebted and do not get institutional credit. They borrow from moneylenders at high interest rates ranging from 20 to 70 per cent. Nor are they getting remunerative prices, contrary to what was promised by the Narendra Modi government on the basis of the M.S Swaminathan Commission recommendations—that is, cost plus 50 per cent of it. And the prices of inputs like diesel, fertilizer and seeds have gone up. That is why they are committing suicide. Agriculture is fast becoming a loss-making venture. Farmers’ children do not want to do farming. If farmers are not saved, how can the country be saved? Seventy per cent of the people are still directly or indirectly dependent on agriculture, and 50 per cent of jobs in the country are in the agricultural sector, though agriculture’s contribution to the GDP has gone down. This sector has not got any attention since Independence. The Congress-led governments did not do anything about it, and the BJP [Bharatiya Janata Party] is also going the same way; in fact, it is worse.

The AIKS had campaigned earlier, too, against farmer suicides last year. What was different about the recent campaign?

The government said it would take steps to reduce farmer suicides, but in the last two and a half years, there has been a 36 per cent increase. The government simply doesn’t care. Farmers are not responsible for the crisis. The problem is in the agricultural policy, which is basically anti-farmer. Eighty per cent of farmers have been affected badly. They are small and middle-level farmers, sharecroppers, tenants, peasants and landless peasants. Only a very small per cent —neocapitalist farmers and rich, landed farmers and landlords—are able to manage. They are the ones who get institutional loans. The smaller farmers cannot give any guarantee because they don’t have any pattas or land to offer as guarantee. So institutional loans, given in the name of farming, are either going to the big farmers or to agrobusiness. Besides, loans are given by bank branches in cities. Farmers do not go to cities to get loans. A pro-farmer, pro-peasant policy has to be formulated. We have a 15-point charter demanding land reforms, remunerative prices, cheaper subsidised inputs, market facilities, 4 per cent rate of interest for rich peasants and interest-free loans for the majority of farmers, and loan waivers. The total farming community has one lakh crore of loans against them. The government can surely waive this, considering the 13-lakh-crore waiver it gave to corporates. Farmers should get some pension, too, at least Rs.3,000. They also serve the country. Government employees work for 25 years and get pension, while farmers work for their entire lives. The public distribution system should be universalised as farmers are producers as well as consumers and 80 per cent are “poor” consumers. The APL-BPL [above and below poverty line] distinction should not be there. If land reforms are done and land is redistributed, it will help the landless come out of abject poverty. Why can’t the government do it? After all, we are talking of 70 per cent of the population. We wanted to meet the Prime Minister on these issues, but he did not give us an appointment.

What has been the impact of the rhetoric of unearthing black money and the present demonetisation on farmers and agriculture?

We do not need certificates from those who claim to be fighting black money. The Left parties were the first to raise the issue of black money. The others joined later on. During our 20-day campaign in November, we witnessed the severe damage the decision caused to the rural economy. This is the rabi crop season, and seeds, fertilizers and daily labour are required. And suddenly the farmers found they did not have liquidity. We found that farmers did not have money to buy seeds and to pay their agricultural labourers, who have to be paid on a daily basis. Then, we found that there were standing crops in many fields, and each day about 10 to 15 workers were required for harvesting. Farming is time-bound. Seeds have to be sown at a particular time. The delay can be very damaging. Rabi crop sowing has been delayed, and there is going be a huge loss.

I spoke to vegetable growers. They said that they were forced to undersell a certain kind of cauliflower. Wholesalers have reduced the off-take from farmers and vegetable growers. There are thousands of farmers who grow vegetables. Only a small percentage of farmers have bank accounts. Most keep their money as 500 and 1000 rupee notes. This money is required for the next crop and for school or college fees or medical expenses. Banks are in distant places. Many were unable to access their own money after cycling for 10 to 15 kilometres. Agricultural work has got seriously impacted. This is also the marriage season, and it is a big thing in rural India. Small notes are not available anywhere; notes of small denominations constitute only 15 per cent of the total currency. With only 15 per cent availability of such notes, how can one run the household, business and work? Then there are small traders dependent on the rural economy. They are also in trouble. If you add up all these sections, one finds that the entire rural economy is in a shambles. People do not know what to do, how to manage their families and cultivation.

How many days could farmers stand in a queue? So now women and children are being made to stand outside banks. We saw this during our campaign. This has damaged the economy. Farmers were already in crisis, this has now added to it.

Some sections in the government argue that output will not suffer much loss.

One can give any kind of figure. It is different from the ground reality. It can be claimed that sowing has taken place in several hectares. But if sowing is done and there is no water and if the crop gets attacked by pests, the output is going to be affected.

The government says that this will encourage people to open bank accounts.

The zero balance accounts are now full of money, we hear. Who is putting the money there should be found out. Not the poor farmer, certainly. The main question is those who have 95 per cent of the black money are praising the move, big business and corporate houses are praising it. It is not affecting them. Agro-based industries are also suffering. Handicrafts are on the verge of closure. They are unable to pay the daily wage in the absence of liquidity.

Do you think lack of preparation has aggravated the crisis?

Yes, they should have printed the notes to replace the ones pulled out of circulation. Where are the ATMs in villages? Around 30 per cent of our unorganised labour force is illiterate. They have no conception of modern technology. They don’t have any PAN or bank account number—how are they expected to survive? A cashless economy can be of benefit to the middle class. In the industrial sector, permanent workers constitute only 7 per cent of the workforce; the majority are casual workers. Then, some 30-35 crore are migrant workers who have no address or identity. They live in slums and have no bank accounts. They are also part of the rural population. There are permanent, seasonal and circular migrants. Tribal farmers are in great difficulty. How many of them have bank accounts? Where are the bank branches in tribal areas? The cooperative banks were giving some money to the rural poor, but they have dried up. The government is destroying the cooperative banks. Initially, cooperative banks were told not to take deposits; then after a hue and cry, the government relented. Every day there is a new directive. It is worse than Tughlaq. Finance is not child’s play. Banks and the RBI [Reserve Bank of India] usually give one order in one year or one order in two years. In one single fortnight after demonetisation, we have had some 20 orders issued by someone or the other.

Agricultural workers form a large section of those dependent on agriculture.

Their situation is the worst. A large number of them are below the poverty line. They are illiterate; there is no question of a bank account or a PAN number. Their work is seasonal. The MGNREGA [Mahatma Gandhi National Rural Employment Guarantee Act] promised them hundred days of work, but nowhere has the number of workdays exceeded 35. In some States, wages have been pending for as long as three months.

It is only in Tripura, which has a Left Front government, where 92 days of work was given. The government should allow people to utilise whatever money they have in hand. At least 70 per cent of denominations should be in small notes.

The government has been arguing that demonetisation will rope in all the unaccounted-for wealth in the country. What are your views on this?

Agricultural income is not taxed. Rich peasants who have additional income can pay tax, but they have also diversified into other areas. A section of them can be brought under the tax net, but 70 per cent of the rural population cannot pay tax as whatever they earn is used up for basic survival. Fifty-four per cent of the women in our country are malnourished. How will 70 per cent of people have unaccounted wealth? This is absolutely foolish. This government believes in giving concessions to corporates. Tenant farmers, sharecroppers and agricultural workers do not come under the tax net. It is foolish to think that there is huge unaccounted-for money lying with the majority of the rural population.