Image used for representational purpose only BATHINDA: Farmers in Punjab, who contribute in a big way to the national pool for wheat and rice, continue to face burgeoning debt.
Various measures have been recommended in the draft of Punjab’s new agriculture policy to provide solace to small and marginal farmers in dealing with the burden of debt.
As per the draft policy, which has cited National Bank for Agriculture and Rural Development (Nabard) estimates, farmers in Punjab had institutional debt of Rs 73,673 crore in 2023.
Another study by NSSO reveals that of the total outstanding loans of agricultural households in Punjab, 78.7% are from institutional sources, while 21.3% are from non-institutional sources.
Though no latest data about non-institutional debt on farmers has been mentioned, certain unverified sources (studies) estimate it to be nearly Rs 24,000 crore.
The policy calls for ensuring transparent and debtor-friendly functioning of institutional and non-institutional lenders including microfinance companies, commission agents, and private money-lenders.
There must be prevention of blank cheques and promissory notes on credit disbursement along with charging exorbitant interest rates by these credit sources, said the draft polict.
Small farmers are under severe economic squeeze, therefore, special debt waiver scheme should be crafted for small and marginal farmers, said the draft policy.
It said there must be effective implementation of Punjab Settlement of Agricultural Indebtedness Act, 2016 so that farmers do not have to pay more than double the principal amount.
In order to pay off loans obtained from non-institutional sources, the ‘Scheme for Debt Swapping of Borrowers’ should be implemented, which will convert noninstitutional loan owed by the farmer into an institutional loan, said the draft policy. In case of crop damage due to natural calamities, there must be a loan moratorium, with an interest waiver for that period on all debt collection.
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