United action

Maharashtra farmers drive a hard bargain, forcing the Devendra Fadnavis government to concede their demand for farm loan waiver.

Published : Jun 21, 2017 12:30 IST

Farmers throwing vegetables on a road in Nagpur during a protest as part of the Maharashtra bandh on June 5.

Farmers throwing vegetables on a road in Nagpur during a protest as part of the Maharashtra bandh on June 5.

NOT since the Shetkari Sanghatana’s agitation in 1982 for remunerative prices for primary milk producers in Maharashtra has there been a united farmers’ action on the scale that the State witnessed in early June. So when the Devendra Fadnavis government conceded the farmers’ demand for a waiver of farm loans on June 11, it was a vindication of their just demands.

Numbering about 1.37 crore, farmers are possibly the largest single group of toilers in Maharashtra and yet they have none of the clout that would normally be associated with such numbers. Instead, they are among groups that are the most invisible and thus the most exploited by the state. The worst affected are those who own less than two hectares of land; they constitute about 78 per cent of the farming community. These small and marginal farmers practise rain-fed agriculture since the majority of the irrigated land in Maharashtra is owned by big and corporate farmers. Already caught in a debt trap, these farmers are unable to borrow from cooperative societies as the cooperative banks that lend money to these societies are bankrupt, the political powers that control them having siphoned off the money.

Although small farmers are eligible for crop loans, they do not get loans for agricultural infrastructure. One farmer summed up their plight thus: the bank would refuse to provide a loan to dig a well because there is no guarantee that it can reclaim the well, whereas it would give a loan to buy a motorcycle.

The economist and former State Planning Commission member Professor H.N. Desarda said: “There is a subterfuge here. To be eligible to borrow you have to pay back, but obviously the farmer cannot pay back. So he borrows from moneylenders so as to be eligible to get bank loans.”

In the past few years, there seems to have been some attempt to assist the farmers. The Congress Chief Minister Prithviraj Chavan had suggested smaller check dams and wells to manage and use water resources locally and to raise groundwater levels. Digging of wells gave the work under the Mahatma Gandhi National Rural Employment Guarantee Act a boost. The plan was good on paper but did not work well. Chavan’s term was beset with problems of a coalition government. The Congress was defeated by the Bharatiya Janata Party (BJP) in the 2014 Assembly elections.

During the election campaign, Prime Minister Narendra Modi promised to implement a minimum support price (MSP) for farm produce, but when Fadnavis took over as Chief Minister he did not honour the promise and instead launched the Jalyukt Shivar Abhiyaan, a promise to make Maharashtra drought-free by 2019. The scheme was not different from Chavan’s plan (which in itself was a mere reiteration of what farmers had been doing for generations). Fadnavis used film stars to add appeal to his water project.

Fadnavis has tried to tackle the farmers’ issue in the way he knows best, that is, politically. After the elections, he coopted the Swabhiman Shetkari Sanghatana, a powerful farmers’ organisation, by appointing one of its leaders, Sadabhau Khot, as Minister of State for Agriculture, Horticulture and Marketing. But it did not take long for the ground realities to unmask the political moves. Trouble started brewing in 2016 with the government’s policy flip-flops on onion exports and its failure to set a reasonable MSP for soya bean. This was followed by demonetisation, which destroyed all possibilities of considerable profits a good harvest would have brought.

The real trigger was, of course, the government’s unwillingness to set an MSP for tur (arhar) dal (see Frontline , March 26, 2017). Farmers saw this as the ultimate betrayal. The bumper harvest was a blessing after two years of agricultural drought. In the previous season, tur dal growers were given higher support price because of a scarcity, and this had encouraged them to expand the area under tur cultivation. The bumper pulses crop and the government’s inability to buy much of the yield led to a crash in prices. Farmers were forced to sell their produce at Rs.2,500 a quintal when they had been promised Rs.5,050 a quintal. Although procurement began, it was so slow that about 1,000 quintals are yet to be paid for despite farmers holding the tokens that are issued as proof of purchase.

The farmers launched a full-fledged State-wide protest on June 1. They gave the government adequate notice, but Fadnavis seemed to rely on politicking rather than understanding and resolving the situation, thereby displaying his naivete, like many in the BJP, on rural matters. A source, who requested anonymity, said Fadnavis’ “lack of knowledge in these matters is embarrassing… he is like a boy in a school debate”.

The Chief Minister had not banked on the opposition rallying around and joining the protest or on the vociferous support of the BJP’s alliance partner, the Shiv Sena, to the agitating farmers. In any case, both were politically motivated moves. The previous Congress-Nationalist Congress Party government shied away from implementing the reports submitted by the National Commission on Farmers chaired by M.S. Swaminathan between 2004 and 2006.

In his initial dealings with farmers, Fadnavis had said that the State could not afford to waive loans. But, his government has pledged to install a statue of Chhatrapati Shivaji at a cost of Rs.3,600 crore in the sea, not wanting to offend the powerful Maratha lobby. True, there is a huge difference between Rs.3,600 crore and the Rs.31,000-crore debt of small and medium farmers, but the question of principle in this cannot be dismissed. Desarda pointed out that the Centre was willing to write off a likely Rs.4 lakh crore debt of the telecom sector, but farmers, who are not organised in the political sense, were sidelined.

The main victories the agitating farmers achieved were an immediate blanket loan waiver for those owing less than two hectares, with the option of immediately applying for a fresh loan. Milk sellers would get 70 per cent of the selling price. They now get only Rs.20 a litre, while milk is sold to the consumer at Rs.50-60 a litre. All police cases against activists and farmers, except those who indulged in looting, were withdrawn immediately. Further discussions would be carried out by a 10- or 12-member committee, consisting equally of farmers’ representatives and government officials. The government, however, deflected the main issue of implementing the Swaminathan Commission report by saying that the Centre had to take a decision on it.

Fadnavis, however, promised to lead a delegation to the Centre to argue for the implementation of the reports. The farmers set July 26, two days after the start of the monsoon session of the Assembly, as the deadline to implement the promises, failing which they would resume the protest.

While the points above are crucial, hard-headed bargaining is needed to make systemic changes such as adding a buying guarantee clause to bolster the Swaminathan Commission report, reviving land mortgage banks since they provided loans for agricultural infrastructure, modernising irrigation techniques, and rescuing the cooperative system from politicians.

Desarda said: “It is not kaarj maafi [debt waiver] but kaarj mukti [freedom from debt] that is required.” For this, he suggested remunerative prices for produce linked to guaranteed purchase by the government, minimum wages for agricultural labour, and reintroduction of the Employment Guarantee Scheme as a notional guarantee. “It should be like the fire brigade; ideally there should be no fire but if it occurs there should be someone to put it out,” he said.

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