The Hindu : Andhra Pradesh News : Farmers' panel moots `distress fund'

Online edition of India's National Newspaper
Sunday, Dec 12, 2004

Andhra Pradesh

Andhra Pradesh

Farmers' panel moots `distress fund'

By Our Special Correspondent

Jayathi Ghosh, Chairperson of the Commission on Farmers' Welfare, and other members, presenting the final report to the Chief Minister, Y.S. Rajasekhara Reddy , in Hyderabad on Saturday.

HYDERABAD, DEC. 11 Citing heavy burden of debt as the most "acute proximate cause" of agrarian distress in the State, the Commission on Farmers' Welfare suggested formation of "distress fund" and sought the Government's intervention in bringing all cultivators into the ambit of institutional credit.

The Commission's report was submitted to the Chief Minister, Y. S. Rajasekhara Reddy, by its chairperson, Jayathi Ghosh, here on Saturday. The Agriculture Minister, N. Raghuveera Reddy, and other members of the Commission were present.

YSR's assurance

The Chief Minister told presspersons later that the Government would study the report and implement all the recommendations as far as possible after discussing them in the Cabinet. "After all the Commission was constituted by us and we have special interest in farmers' welfare unlike the previous Government," he said.

Dr. Ghosh said a major recommendation related to revival of public institutions. The Commission prepared an extensive report touching upon all aspects that affected the farm sector. On farmers continuing to commit suicide, she said the problem was complex and could not be solved in a day or two. " It takes a long time. It is easy to destroy public institutions but difficult to rebuild them."

The Commission said the decline of the share of institutional credit and lack of timely access to formal credit had dealt a big blow to farmers. Besides ensuring that the formal banking system met all credit requirements of all types of farmers, the Government should take the lead in reviving social banking. The Government should set up distress fund with support from the RBI and NABARD and use "Helpline" to enable farmers to access loans.

The other interventions it has suggested fall into five broad areas, apart from credit. The Commission suggested correcting spatial inequities in access to irrigation and sustainable water management and shifting of policies to focus on dryland farming through technology, extension, price and other incentives.

It wanted the Government to encourage cheaper and more sustainable input use, protecting farmers from the volatility in output prices and rural economic diversification to more value added activities. The Government should increase substantially public expenditure on agriculture and allied activities to reach 5 per cent of GSDP in the next budget.

Observations

The Commission observed that agriculture in the State was in an "advanced stage of crisis." The causes were complex and manifold but they dominantly relate to public policy. The economic strategy of the past decade at both Central and State Government levels, had systematically reduced protection afforded to farmers and exposed them to market volatility and profiteering.

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