May 27, 2018, 11:02 pm IST
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To waive loans or not …

To waive loans or not …

P S Joseph, Jun 15, 2017

The neglect of the farmers and their woes are not new in independent India but in the present day when high decibel voices are heard on the increase of GDP, farmer's issues are quite forgotten. Not a day passes without hearing of at least a suicide of a farmer in Madhya Pradesh or in Maharashtra. Farmer's issue got highlighted during the recent Uttar Pradesh elections where the BJP promised loan waiver to the farmers. The Yogi Adithyanath government of BJP which came into power in Uttar Pradesh kept it promise of the loan waiver but in the process it has opened up a Pandora’s  box revealing the state of our agriculture. Many of the farmers were forced to commit suicide driven by loan sharks. If it was first the turn of Tamil Nadu farmer`s  to protest in various ways like drinking urine and eat mouse in Jantar Mantar In Delhi , the farmers in Maharashtra and Madhya Pradesh resorted to agitations which even paralyzed the governments. In order to appease the farmers hell bend upon the struggle the Maharashtra government come up with loan waivers and Madhya Pradesh may follow suit triggering worries on the high cost it would make on the economy. Already Arun Jaitley ,the finance mister has warned the states that such waivers would not be at the cost of centre

While the issue is taking political overtones, the farmers are left high and dry. In Madhya Pradesh .the agitating farmers were fired at killing five which resulted in a national outcry against it. In Maharashtra  the agitation was called off only after assurances were met with. Madhya Pradesh also would be forced to enact a truce, at least a piece meal one

The government's reluctance to address the problems of the farmers are more than financial. It requires an overhaul of the system to penetrate to the lower level with new policies on agriculture. M S Swaminathan commission asks the government not to effect loan waiver as it would affect the farmers badly in future and insists on strengthening the spend on agriculture. But farmers who has seen low prices for their produce or no takers for it are unable to pay their lenders or to invest new .The flow of money required for a sound financial system in the rural area is missing and that is where the role of government comes in: to assure cash flows and allow a neat mechanism to give a real price to the produce.

But the real cost for the ruling BJP may be at the electoral front.  Karnataka and Gujarat are going to face the electorate. Madhya Pradesh would follow. Opposition may cry foul over the issue amid signs of protest being taken over by the Indian National Congress (INC) and other parties. With the centre distancing itself from the financial commitment the states have to bear, the BJP governments are facing a tough time.

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