Punjab farmers using bank loans for social functions:ICAR

Ludhiana, Nov 27 (UNI) A major portion of loans raised from financial institutions and commission agents by the farmers of Punjab has not been re-invested in agriculture but on social functions like marriages.

''Loan money picked up by the farmers is getting diverted for obtaining visa through travel agents or purchasing vehicles,'' Indian Council for Agriculture Research (ICAR) Deputy Director General J S Samra said while addressing a international symposium on Balanced Ferilisation for Sustaining Crop Productivity at the Punjab Agricultural University (PAU) here today.

''The massive injunctions of loans by farmers into non productive investment requires counselling and social engineering that is virtually absent from governance'', he added.

In the Indo Gangetic plain as a whole, the total factor productivity has drastically gone down and Punjab is no exception, he said. What has compounded the problems of Punjab agriculture and its farmers is indebtedness, he opined.

Higher banking credit limits have accentuated this problem because the only surety the banks seek from farmers is ''mortgage'' of farmers' land, the consequence spill-over of over loaning is leading to suicides, the ICAR official said. Declining economic returns is a matter of serious concern to policy makers, who have Punjab on their radar, he said.

Dr Samra pointed out that in terms of total factor productivity, Punjab is on a very weak wicket consequent to which, the gap between rural and urban life is growing and sustaining social fabric is becoming difficult. There are apprehensions that if correctives are not applied to accelerate growth in agriculture sector, enhance income of farmers, checks and balances are not applied to private investors, Punjab will loose its pride in agriculture sooner than later due to challenges posed by developing neighbouring states, he warned.

Refering to statistics, Dr Samra said the situation is alarming because growth of agriculture sector which was around 4.5 per cent in 1980 has averaged around 1.5 per cent during the last five years in this border state, he pointed out. Out of the 70 per cent rural population, 58 per cent is directly employed in agriculture and this segment shares only 22 per cent of the total gross domestic product (GDP), he said.

''In other words, a large proportion of overall eight per cent GDP growth is being enjoyed by only a creamy layer of the population,'' he added.

Punjab certainly is still counted among the agriculturally progressive frontline states like Maharashtra, Andhra Pradesh, Kerala and Gujarat, he said. It has been observed that not only large public investments have been made in western states of the country but even suicides have taken place mostly in these states, he claimed.

''It is feared that with more income coming from non-foodgrain sources like horticulture, vegetables, etc, the rural suicide scene in future may become more severe if ''sensible diversification'' is not done'' Dr Samra predicted.

According to Dr Samra over mechanisation was another major cause of indebtedness, while the rural-urban divide poses a serious threat to social security. Refering to the maintainence of soil health and water management, Dr Samra said fertiliser consumption and expansion of fertiliser industry has remained stagnant in the country for the past 5-6 years. This is the only sector that has failed to attract any direct foreign or even indigenous investments and the problem lies at the doorstep of the government, which provides a massive subsidy of Rs 30,000 crore, annually, to the fertiliser industry, he said.

The fertiliser industry is least interested in new technologies to switch over from Naphtha-based fertiliser production to gas-based fertilisers because its returns are assured in the subsidy component, the ICAR official added.

Dr Samra said the fertiliser plants in India are ''medieval'', India is self-suffiient in urea but one third of the production is Naphtha-based which is two and a half times costlier than gas-based manufacturing. If the cost of producing one tonne Naphtha-based fertiliser is Rs 15,000, one tonne gas-based fertiliser would cost only Rs 6,000, he claimed.

India will have to continue to depend on imports for phosphorus and potassium fertilisers, he said. Though potassium can be recovered from the ocean, seaweed farming is not possible due to coastal zone restrictions, he said.

Presenting a not very rosy picture of agriculture in Punjab, Dr Samra said political 'will' is as important as 'right type' of investments in infrastructure, right from collection of product at the farm gate to refrigerated transport, cool chains and exports.

Talking about stepping in of big private business houses in the agricultural arena or setting up of Special Economic Zones (SEZs), Dr Samra said farmers were getting a raw deal in terms of returns.

His apprehensions were that private investors would eventually resort to ''change in land use to save taxes''. Such industry may not be able to provide quality and uniformity of produce needed in modern marketing system, he said He said if Punjab is to develop rural infrastructure and attract SEZs, let these be set up by the industry on wastelands along the Sutlej, the Beas and the Ravi on sandy tracks or in Shivalik foot-hills.

Unlimited possibilities can be explored to inject investments to pave the way for the second green revolution, as precision agriculture has become possible due to rural electrification, rural connectivity, communication, credible infrastructure of agricultural universities, etc, he said.

The aim of future diversification for enhancing income, employment, profitability and sustainability must be coupled with good governance, he suggested.

UNI