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Cash crunch proves a hot potato for these farmers

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Cultivators in Punjab and Haryana head for another period of distress, thanks to demonetisation

Demonetisation of Rs. 500 and Rs. 1,000 notes has badly hit potato growers in Punjab and Haryana where farmers are heading for yet another period of distress as they are finding it difficult to recover even the cost of produce, let alone make profits.

In Jalandhar’s vegetable market, the fresh-crop potato fetched as low as Rs. 100 per 50 kg packet (Rs. 2 per kg) on Wednesday as potato seed growers blamed demonetisation for the poor returns.

‘Way below’

“Price of fresh potato is so low this season that farmers are finding it difficult to recover even the inputs costs. On an average, the cost of production for potato is Rs. 7 to Rs. 8 per kg, but the farmer is getting way below it,” Jaswinder Singh Sangha, general secretary, Jalandhar Potato Growers’ Association, told The Hindu.

“Same time last year, farmers were getting around Rs. 600 per 50 kg,” he said.

The new season potato crop from the ‘Kandi belt’, including Hoshiarpur and neighbouring districts of Punjab and also Una district in Himachal Pradesh, has started arriving in the markets but farmers are finding it difficult to sell their crop in the absence of buyers.

“Since demonetisation, traders are facing cash crunch, resulting in a drop in bulk orders from big markets like Delhi. In local markets there are a fewer buyers and hence farmers are getting a far lower price,” Mr. Sangha said, adding that the potato grower had earlier suffered losses due to drop in sale of seeds and now again when the fresh crop has reached the market.

Potato growers from Punjab on Wednesday wrote a letter to Prime Minister Narendra Modi, asking him to waive off their crop loans.

Clash with peak season

“While we appreciate the government’s [demonetisation] move, we have suffered huge losses. Potato seed farming business accounts for nearly Rs. 1,500 crore annually, but this year we are estimating a loss to the tune of Rs. 800-900 crore,” he said, adding that demonetisation had clashed with the peak season of potato seed when it is supplied nationwide.

Notably, Punjab produces quality potato seed, which is distributed across the country, including in West Bengal, Gujarat, Karnataka, Uttar Pradesh, Madhya Pradesh and Odisha. Potato seed is supplied from the first week of November to mid-December every year. In neighbouring Haryana, the situation is no different as farmers are forced to sell potato at a dismal price on account of poor demand.

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Printable version | Jan 20, 2020 12:27:59 AM | https://www.thehindu.com/news/national/Cash-crunch-proves-a-hot-potato-for-these-farmers/article16920197.ece

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