When, prime minister, Modi during his high octane campaign in the run up to assembly elections in Uttar Pradesh [UP] promised loan waiver for farmers [albeit small and marginal/poor] in the state, he might not even have contemplated that state-after-states would be confronted with similar demands. In retrospect, this is precisely what has dawned on the political establishments particularly in states ruled by BJP viz. Maharashtra, Madhya Pradesh, Haryana etc. The irony is that whereas, BJP had voluntarily made a commitment in a poll bound state, the demand for loan waiver has surged even in states where it was not a poll promise. Those states have been coerced in to granting waivers using the modus operandi of protests and demonstrations....
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Category: Credit & insurance
Yogi – Modi onslaught on poverty
The just concluded assembly elections in Uttar Pradesh [UP] were fought in the backdrop of deteriorating law and order situation, hostile environment for investment, crumbling infrastructure [sans a few pockets in urban areas], widespread farmers distress, their high level of indebtedness and acute shortage of bare necessities viz. home, food, education, health, water and electricity. The poor investment climate and pathetic law and order discouraged industrialists and businessmen from setting up factories/shops even as existing establishments were facing closure. Together with farming being un-remunerative/losing proposition, this made a deadly cocktail leading to large-scale loss of jobs and in turn, migration of youth en mass to other states such as Maharashtra and Gujarat. Promises galore BJP led by Modi promised liberation...
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PM agri–insurance scheme – challenges ahead
Farmers in India are constantly under the threat of drought and other natural calamities such as floods, hailstorms, pest attacks etc leading to unprecedented loss of crop output. Unable to pay back loans [taken for growing crop], tens of thousands of them commit suicide every year. It is a national curse. The issue has been debated several times in the parliament wherein parliamentarians across the political spectrum pledge to put an end to it but things have so far remained at a standstill. The Pradhan Mantri Phasal Bima Yojna [PMPBY] launched by Modi – government early this year has come as a beacon of hope. Under PMPBY, a farmer will be compensated for the crop loss by paying small premium...
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Vanishing food stocks and bleeding banks
For the first time ever in the history of food procurement, storage, movement and distribution by state agencies, India has faced an unprecedented situation of hibernating food stocks worth Rs 20,000 crores in Punjab. The stocks were mostly funded using cash credit taken from a consortium of public sector banks [PSBs]. In an equally unprecedented move, the Reserve Bank of India [RBI] – the regulator of banks – has directed concerned PSBs to declare the mentioned loan as non-performing assets [NPAs] and accordingly make a provision of 7.5% during the quarter ending March 31, 2016 and another 7.5% during Qr ending June 30, 2016 for now. That adds to Rs 3000 crores [15% of Rs 20,000 crores] and will correspondingly...
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Agrarian crisis – all man made
Every now and then, one hears talk of agrarian distress and farmers committing suicide. They are heavily indebted and are unable to earn enough to make both ends meet and repay the loan. The average monthly income of farmer is about Rs 5000 whereas for many, it is even below Rs 2000. It is also a fact that the government spends gargantuan amounts on subsidizing agricultural inputs viz., fertilizers, seeds, irrigation etc and makes huge quantum of credit available to them through public sector banks [PSBs] at subsidized rate of interest. Yet another truth is that barring present dispensation under Modi, government of the day had granted sumptuous increase in minimum support price [MSP] – a bare minimum price that...
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LOOKING AFRESH AT FARM SECTOR
The Modi Government has taken a slew of measures to double farmers’ income by 2022. However, for these efforts to succeed, State Governments must cooperate, as the real action can only take place at the ground level Prime Minister Narendra Modi’s objective to double farmers’ income by 2022 is being looked upon with scepticism. Critics argue that this will require an agricultural growth of more than 10 per cent per annum, at a time when growth in agriculture has collapsed to less than half a per cent per annum. Critics also argue that the minimum support price has risen only marginally (around four per cent) under the Modi dispensation. Both arguments are flawed. First, a number of States such as...
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Doubling farmers income – not a mere slogan
Prime Minister Modi’s promise to double farmers income by 2022 [the 75th anniversary of India’s independence] is being looked at with lot of scepticism in opposition quarters as also among some critics who look with a microscope every single opportunity to embarrassment him and his government. What is the basis for such scepticism? First, driven by a pre-meditated mindset, they are unable to see or not wanting to see any action happening on the ground. Second, they cite no increase in minimum support price [MSP] of food under Modi – dispensation to infer as to how then, farmers income could be doubled? Both points require careful scrutiny. To see what happens to MSP alone can be misleading. This is because...
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PM Fasal Bima Yojana – intent laudable, what about execution?
Modi – government has been under persistent attack for its obsession with promoting the manufacturing sector [under its flagship “Make in India”] but neglecting agriculture on which nearly 2/3rd of people depend for their livelihood. Critics have also lambasted it for alleged takeover of their land under the Land Acquisition [Amendment] Act 2015 to promote industrial development at their cost. However, to demonstrate that it cares for the farmers, the government has launched the Pradhan Mantri Phasal Bima Yojna [PMPBY] which it claims will bring about a drastic improvement in their economic conditions. Under PMPBY, the government’s intent is to compensate every farmer for the crop loss [due to a variety of factors such as natural calamities, hailstorms, unseasonal rains...
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