Tenant farmers on loan hunt as kharif time arrives

With dwindling bank help, they are likely to fall prey to private lenders

Tenant farmers from East Godavari are in search of finance to commence paddy cultivation for the kharif season.

With the commencement of the kharif season, tenant farmers cultivating paddy in East Godavari district are on the search of finances to meet the input costs.

Of the 2.74 lakh hectares of cultivable land, paddy is expected to be sown in 2.32 lakh hectares (about 5.75 lakh acres) and over 70% of cultivation is being undertaken by tenant farmers. According to a rough estimate, over four lakh tenant farmers are engaged in paddy cultivation in the district, and a majority of them are cultivating about an acre, for which the in put cost is about ₹30,000.

“This year’s target is to issue Loan Eligibility Cards (LEC) to 1.16 lakh tenant farmers from the district, of which 70,000 have been given the cards and loans disbursed to 4,400 farmers so far,” says Collector Kartikeya Misra, adding the objective was to disburse crop loan to at least 75% of the tenant farmers. Last year, the banks disbursed ₹172 crore to the LEC holders, against the target of ₹7,000 crore.

The ground reality is that the number of LECs are decreasing every year.

Three years ago about three lakh cards were issued. Not all the tenant farmers are getting the cards and not all cardholders are getting bank loans.

Hence, the farmers are looking towards private players — particularly paddy traders — for loans. As a result, they are forced to sell their produce to the same traders at the end of the crop that too a price fixed by the latter.

Vicious circle

“It is a vicious circle and the tenant farmers are unable to come out of it. In fact, the LEC can become a boon to them, provided all the eligible are covered under the scheme and get loans from banks. But, the ground reality is quite contrary, and the banks are not willing to disburse loans to tenant farmers,” observes M. Rajasekhar, district secretary of the Andhra Pradesh Koulu Rythula Sangham, a front organisation of the CPI (M).

“Not just the loans, but the subsidies too are being given to landowners, but not to the tillers who are toiling round the year. Sincere approach towards tenant farmers is the need of the hour,” he says.