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Punjab to enact a law for special relief package to farmers

Written by: Staff
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New Delhi, July 3 (UNI) Punjab Chief Minister Capt Amarinder Singh today said that state would soon enact a law for providing special relief package to bail out farmers from rural indebtedness as no debt relief on the basis of Vaidyanathan Committee Report or Vidarbha like package has been given to them.

Speaking at a Planning Commission meeting organised by its Deputy Chairman Montek Singh Ahluwalia here, Capt Singh said low farm prices, rising input costs and inadequate increase in productivity are responsible for the problem of agrarian stress.

''This is depicted by the mounting rural debt which stands at Rs 26,000 crore -- Rs 7,800 crore of Commercial banks, Rs 6,200 crore of Cooperative Banks and Rs 12,000 crore of money lenders. This immediate problem is not that of access credit, but the unbearable burden of payment of interest and repayment of loans,'' he said.

The Chief Minister further informed that the State Government has reduced interest on co-operative loans from 14.5 per cent to 9 per cent and has also offered one time settlement (OTS) for settling sticky loans. Hence, there is a proposal to enact a new law for providing relief from rural indebtedness.

He said prolonged period of militancy and a continuous mismatch between revenue and expenditure played havoc with the state's economy. The rate of economic growth ebbed to an abysmal 2 per cent in 2001-02. Agriculture and allied sectors, which are the mainstay of the state's economy, clocked in a negative rate of growth during 2001-02.

Therefore, the first priority for the state was to arrest the decline in growth and to restore the financial health of the state.

As a result, the state has witnessed economic revival and a fiscal turn around. From 2003-04 to 2005-06, state's economy has been growing at an average of about 6 per cent per annum.

However, due to a poor rate of growth in the first year of the 10th Five-Year Plan, the rate of growth during the 10th Plan, is likely to be 5 per cent per annum, as against a target of 6.4 per cent, he added.

''However, due to poor Plan peformance during the first three years of the 10th Five Year Plan, actual expenditure is likely to about Rs 13,400 crore, against the approved size of Rs 18,657 crore,'' Capt Singh said.

The Chief Minister said the agriculture economy of the state has been slowing down since the 80s and agricultural growth declined from a high growth rate of 5 per cent in the 80s to less than 2 per cent at the end of the millennium.

Galloping costs of inputs, stagnation in productivity and unrealistic MSP, which is totally unrelated to increase in cost of cultivation are the major causes of decline in agriculture, he said and added that the natural resource base of soil and water has been degraded and eroded due to over exploitation.

''The consequences have been increasing indebtedness among farmers, loss of morale and tragic narratives of farmers' suicides,'' Capt Singh observed.

To tackle the problem of soil degradation and water depletion, a dedicated programme for promoting resource conservation technologies, such as zero tillage, deep ploughing, raised bed planting and laser land levelling need to be popularised.

He said the state Government was grateful to the Centre for a grant of Rs 100 crore for reinvigorating research and development in the Panjab Agricultural University.

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