Kumaraswamy urges fund to protect farmers from price fluctuations

New Delhi, May 29 (UNI) Stating that his government was pursuing ''farmer centric'' policies in Karnataka, Chief Minister H D Kumaraswamy today urged the Centre to set up a revolving corpus fund for a vigorous market intervention scheme to protect farmers from the fluctuations in world market.

Making a strong plea for a government-supported market intervention scheme with matching contributions from the Centre and State governments, especially for the sugar cane growers, he termed the situation in the agricultural sector during the last decade as ''disheartening''.

Citing figures to support his contention, Mr Kumaraswamy, whose address was read out by state Home Minister M P Prakash, said farmers in his state cultivated 3.75 lakh hectares, achieving a production of 357 lakh tonnes of which 240 lakh tons were meant for sugar factories, who due to ''acute financial crisis'' caused by depressed prices, had stopped crushing operations.

Since the cane prices were fixed beforehand itself, the factories were bound to pay the agreed price to the farmers, which was no longer viable economically, thus causing the cane farmers great stress.

Noting many had borrowed huge sums in anticipation of remunerative prices, he said the the reality was totally different with the cane not able to be even crushed. ''We need to rescue sugar cane growers, who are a in precarious situation, by announcing incentives both to the factories and farmers and the Union government needs to take the lead to protect the sugar industry'', he urged.

The Chief Minister said the Agriculture sector received less than its due share of public resources as well as private investment and the adverse consequences of this imbalance were reflected in the decline in the sector from a level of 3.2 per cent growth rate in 1980-96. The growth had reduced to 2.1 per cent in IXth plan period of 1997-2002 and further down at 1.5 per cent during 2006-07.

Linking the declining growth in the sector to the rising indebtedness among small and marginal farmers, he said the cost-risk returns profile of farming had gradually worsened for 80 million farming familes across the country who owned between one and two hectares of land. ''These resource-starved, families mired in debt, were unable to benefit from the economies of scale, both in the production and post harvest phases of farming,'' he said, adding his state government had concluded that a substantive debt amelioration strategy was the first step required to lift these families out of vicious circle of deprivation and despair and to put them on a renewed parth of growth.

In pursuance of this policy, the state, in its Budget 2006-07, waived off cooperative loans upto Rs 25,000 per farmer and continued to provide cooperative loans at four per cent interest.

The Centre too should consider similar steps in case of commercial bank loans availed by the farmers, he said.

Seeking the Centre's support and guidance on the need to liberalise the the regulations on food processing industries, the Chief Minister said the freight cargo subsidy given by the APEDA was inadequate and required scaling up of support for higher exports.

Asking for tackling of some of trade-related issues like rigid export procedures, he said Karnataka's excellent quality pomegranates, which were acceptable to the European Union, were finding it difficult in United States. ''Like the mango issue was resolved, the pomegranates peoblems too should be solved,'' he added.

He also sought clearance from the ICAR and central support for the proposed Horticulture University project to be set up at Bagalkot for enhancing institutional support for research and capacity building in backward areas of North Karnataka.

UNI