Pawar blames poor credit for farmers' suicides

Study investigated 41 and 36 suicides in Medak and Prakasam districts respectively

An officially commissioned study has confirmed suicides by farmers in Andhra Pradesh in 2004, attributing them to acute shortage of water and massive debt burden, Union minister for agriculture Sharad Pawar said on Monday. He said the deaths were an example of a deteriorated farm credit system, which needed to be strengthened.

The study found and investigated 41 and 36 suicides by farmers in Medak and Prakasam districts respectively in Andhra Pradesh, Pawar said.

"No other pain is as acute as that of the reported instances of suicides by farmers. We have tried to investigate it through a detailed study by Hyderabad-based National Institute of Agriculture Extension and Management," Pawar said during a discussion on Demand for Grants for Agriculture in 2005-06. The Demand for Grants for the ministry was eventually passed in the House by a voice-vote.

He said that the institute has studied the issue in detail in Anantpur, Prakasam and Medak districts of Andhra Pradesh with the time between May 14 and October 17, 2004 as the reference period.

According to the study, all those who committed suicides were farmers and 96 per cent of them were males. Around 51 per cent were of the forward castes and 28 per cent belonged to the backward castes. A significant 57 per cent were illiterate, Pawar said.

The minister said that 78 per cent of those who committed suicides were at the mercy of rainfall and bore the brunt of drought for the three consecutive years. "This shows that our agricultural extension system has failed," he said.

A majority of the victims were tilling their own lands and had taken loans to set up borewells, the minister said, and added that 76 per cent of them borrowed money from non-institutional lenders at a whopping rate of interest. "This is an example of a deteriorating system, I accept," he said.

Average debt per hectare per victim was over Rs 200,000, mainly due to lack of water for their crops, Pawar, quoting the study, said.

He lamented that around 60 per cent of the total cropped area in the country was still dependent on the monsoon and yet the average allocation for irrigation in the annual Budget in the past decade was a pitiable 0.35 per cent. In 2003-04, allocation for irrigation was Rs 23 billion as against Rs 35 billion for drought relief.

"It is the paradox of our times that the amount allocated for the calamity relief is more than allocation for something which can help us avoid the calamity," the minister remarked. He said in the current financial year, the sum earmarked for irrigation has been significantly enhanced to Rs 40 billion.

Efforts were also on to step up farm credit and the target of Rs 1.08 trillion for 2003-04 had been met. However, the share of cooperative banks in the overall disbursal of credit to farmers had fallen and there was an urgent need to strengthen India's rural cooperative credit structure.

Since these banks had accumulated deposits over the years on which it was paying a higher rate of interest, it will not be possible for them to cut their interest rates on loans for the next 2-3 years.

The minister also expressed concern over the annual post-harvesting losses of over Rs 500 billion in India's farm sector due to a poor rate of food processing at 4 per cent. He said the provision for a Horticulture Mission in this year's Budget will help address the problem.

Pawar also favoured efforts towards crop diversification by increasing the minimum support prices of oilseeds to encourage farmers to grow them, which he felt would help curb import of edible oils.