The Hindu : New Delhi News : Farmers seek credit at 4 per cent interest

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Friday, Jan 11, 2008
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New Delhi

Farmers seek credit at 4 per cent interest

Special Correspondent

‘Decline in govt. investment in agriculture must be reversed’

Address rural-urban divide and disparities
Provide direct fertilizer subsidy to farmers

NEW DELHI: The Consortium of Indian Farmers’ Association (CIFA) has urged Finance Minister P. Chidambaram to extend farm credit at four per cent interest and double the outlay on agriculture “as a first step” in his budget proposals this year.

A CIFA delegation met him here on Tuesday as part of the government initiative to hold pre-budget consultations.

Holding the government responsible for the agrarian distress, the CIFA urged the Minister to take fresh policy initiatives to address the rural-urban divide and remove economic disparities. It sought direct fertilizer subsidy, and implementation of the report of the National Commission on Farmers.

Pointing out that stagnation in farm income and widening economic disparities were a cause for alarm, CIFA secretary-general Chengal Reddy said the persistent decline over the past three decades in government investment in agriculture must be reversed. At present, it was just 1.3 per cent of the Gross Domestic Product.

“The share of the outlay on agriculture is a mere 3.6 per cent in the present five-year Plan. The Union Government spent Rs. 63 per hectare of the net sown area in the 5th Plan, which was reduced to Rs. 18 in the 7th Plan. Since the 1990s, the spending had further reduced to just about Rs. 10.”

Seeking a long-term policy, the CIFA said if the government wanted food security and farmers to continue in the farm sector and develop global competitiveness, it would have to pay attention to infrastructure including irrigation, production and extension issues, finance and tax incentives, and their welfare and empowerment.

The delegation sought Rs. 10,000 crore for introduction of high-yielding seeds and a subsidy on organic fertilizers produced by converting urban organic waste.

Basvaraj Ingin of Karnataka alleged that there was a “conspiracy” in not directing research for development of new varieties of pulses.

National Sugarcane Commodity Council convener K. Prabhakar Reddy said there was no transparency in the fixing of the minimum support price by the Commission of Agriculture Costs and Prices for commodities meant for the PDS. Computation of cost was not in keeping with the cost of cultivation, nor did it take into account the actual cost of inputs, the ruling international prices and production cost.

Seeking a review of the MSP methodology, the CIFA said unless all parameters of the scheme were complied with, farmers would face “irreparable losses.”

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