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Nation's food bowl in crisis

By Anosh Malekar

When the state that was the country's biggest agricultural success story in the 1970s tops the list of indebted farmers, it is obvious that there is something very rotten in the state of agriculture in the country. A three-part series that looks at the agriculture crisis in India's food bowl, Punjab

When Veer Davinder offered to serve whisky before dinner at his farmhouse in Dabrikhana village in Punjab's Faridkot district, the young farmer made it a point to clarify that the offer was not reflective of the situation of farmers in the state. His friends said it was part of Punjab's tradition of hospitality, and a polite refusal to partake of the whisky did not stop the hardy Jat farmers from stuffing their guest with good food.

We were here to discuss the reported crisis across Punjab's fields. The Jats were at a loss to explain their situation. "Anakh jattan di," said one of them, meaning that the Jat brotherhood prided itself on the fact that a Jat may break, but won't bend. "Once upon a time this meant that even if a single Jat farmer committed suicide, it was a blot on the entire brotherhood. Tragically, in Punjab today, it means that a Jat farmer would rather break and commit suicide than bend to seek help or mercy," says Labh Singh, a farmer himself.

The crisis of agriculture in Punjab is as peculiar as the fact that farmers in Punjab are predominantly from the Jat community which is comparatively much better off than the communities that comprise farmers in the rest of the country. Punjab produces around two-thirds of the foodgrain procured annually in the country, a remarkable feat for a state that occupies only 1.5 % of the country's geographical area. But this has also meant overexploitation of land and other resources and intensive use of inputs as a result of which Punjab's farmers are today more heavily in debt than farmers in any other state.

According to the latest National Sample Survey Organisation (NSSO) data, farm households in India have an average outstanding loan of Rs 1,258, but in Punjab the average outstanding loan is Rs 41,576 (December 2003). The state's farm indebtedness, that is, unpaid loans, both in the formal and informal sector, is around Rs 26,000 crore, more than the state's gross annual earnings from agriculture.

The recovery rate of institutional loans in Punjab, too, is the highest in the country at 85 %. With overdue loans hardly around 15 %, Punjab will not stand to benefit much from the debt relief measures proposed in the Union budget 2008. "The resource allocation criterion of the Centre has been disfavouring the better performing states, and Punjab, with such high debt recovery, would naturally not benefit much," says economist Ranjit Singh Ghuman of Punjabi University, Patiala.

The Union budget announcement of a bank loan waiver for small farmers caused only faint smiles across the emerald fields of Punjab, which have a bumper wheat crop this season. "Ninety per cent of farmers in Punjab are in debt, but a majority of them have taken loans from arhtiyas (commission agents) and private moneylenders, not banks," says Shamsher Singh, 56, a well-to-do farmer from Hari Majra village in Patiala district.

Shamsher Singh should know, as he is also the director of the Kheti Vikas Bank, Chandigarh. "Punjab's farmers will not benefit unless the loans from private money lenders are waived completely," he says. The non-institutional loan was the biggest evil because of its high proportion - according to some estimates, 50-55 % of total agriculture loans in the state - coupled with the high rate of interest, ranging from 26 % to 60 % annually.

A bank official in Chandigarh said it was a very complex process to find out how much small and marginal farmers owe. But loan figures with the state agriculture department to date revealed that Rs 15,219 crore was advanced by commercial banks, Rs 4,080 crore by cooperative banks and Rs 1,974 crore by Punjab Agriculture Development Bank. Which means that the total burden of non-institutional loans could be anything around Rs 20,000 crore.

Initial estimates by officials hint that Punjab's farmers would benefit by between Rs 800 crore to Rs 1,000 crore under the loan waiver scheme. Compared to their contribution to the nation's food security, this benefit is considered insufficient to manage the crisis of 3.47 crore marginal and small farmers and 87 lakh other farmers in the state.

The fact that this prosperous state has been reporting a spate of farmer suicides in recent decades surprises many outside the state. With the Punjab government in denial mode, there are no definitive suicide figures yet. Independent studies have, however, brought out the gravity of the situation.

In November 2007, the Movement against State Repression (MASR) wrote to Lok Sabha speaker Somnath Chatterjee and all parliamentarians, listing seven different estimates of the number of suicides in Punjab, pending an official survey by the state government.

The suicide figures ranged from a handful to several thousands. While the Punjab government's status report listed 2,114 farmer suicides during 1988-2004, the Punjab Farmers' Commission 2006 said some 2,000 farmers were taking their own lives every year. Surprisingly, the Punjab Police Report 2007 listed only seven suicides in as many years, and the Punjab revenue report for 2007 conceded 132 suicides in the past five years. The MASR's own estimate of farmer suicides for 1988-2006 was around 60,000.

Says MASR convenor Inderjit Singh Jaijee, "The Central government is willing to concede farmer suicides in Maharashtra and the southern states, but not in Punjab because the state has long been projected as an agricultural success story. If government admits farmers in Punjab are distressed, it would mean agriculture in India was in distress."

MASR, a non-government organisation started in the 1980s by Jaijee, a former MLA, had warned the powers that be in New Delhi and Chandigarh in 2001, that suicide is violence turned inward in Punjab. 'It will not be long before anger and despair are turned outward and result in social and political turmoil,' it stated in a memorandum to the government.

MASR's data from an in-debt survey of 1,508 suicides from 1988 onwards, in Moonak sub-division in Sangrur district, comprising 91 villages, throws some light on the suicides by Punjab farmers. Farmers committing suicide by consuming poison, hanging or throwing themselves under speeding trains were in the age group of 19-50 years. Most of them were landless, marginal and small farmers, but also those who owned up to 10 acres of land. The debts ranged from Rs 20,000 to Rs 7 lakh, but a majority of those who ended their lives owed agriculture debts of less than 1 lakh. The least developed south-eastern region of Punjab, bordering Haryana, was the worst affected.

"The causes of the Punjab farmer's downward spiral into debt for the past two decades are many, but a major part of the blame falls on the inequitable cost/price structure, non-availability of credit, high rates of interest, restrictions on trade and ceiling on agriculture land," says Jaijee.

In the absence of a holistic approach to cure the malaise, the loan waiver will prove to be only a temporary crisis management measure in Punjab as elsewhere in the country, he says.

The suicides are a symptom of the agricultural crisis whose roots lie in soil contamination, soil erosion, reduced soil fertility, micronutrient deficiencies, falling water tables, water shortages, and increased vulnerability to pests, all of which have contributed to falling incomes from agriculture. This has led to overall rural impoverishment, reduced availability of nutritious food crops for the local population, increased drug use and alcoholism in the countryside, the displacement of vast numbers of small farmers from their land, more and more farmers being forced out of agriculture, and increased social tensions and conflicts.

Experts have been discussing the Punjab situation for a while and the discourse on the continuing crisis in agriculture has progressed from 'crop diversification' to a 'second green revolution', with no consensus yet. Farmers' organisations say the present crisis has been around for a while and is a by-product of Punjab's success story in ushering in the green revolution. "Punjab has been contributing the largest share of wheat and rice to the central pool for well over four decades. In the process, it has suffered grossly," says Umendra Dutt of the Kheti Virasat Mission (KVM).

Dutt says the Punjab agriculture model was a "paradigm mistake" and farmers were committing suicide due to deceleration of agricultural growth since the mid-1980s. The KVM has taken up the Punjab farmers' cause and is involved in 'dismantling the old paradigm by promoting an eco-friendly version of green revolution'.

Called Nanak Kheti, Dutt described it as an ecological farmers' movement to change the entire food culture that has been corrupted by the use of chemicals and to practice of monoculture. So far, 200 villages in 60 blocks across Punjab have joined KVM's effort, he claims.

Jaijee feels that natural and organic farming has a limited scope considering the alarming extent of the agriculture crisis in Punjab. "It is cushioning the misery of the farmer, who, thanks to the thrust of the green revolution, has moved from one crop to two crops a year," he says.

The Punjab farmer feels lost in this debate. Labh Singh says: "We continue to seek more loans for buying expensive seeds, fertilisers and pesticides. It is only when we incur losses that we stop to think, that is, if we have not committed suicide already." As the next article in this series shows, the lack of a coherent government policy means farmers continue to grope in the dark, with disastrous consequences.

InfoChange News & Features, April 2008