Lok Sabha Question No. 269 (UNSTARRED), answered on 2020-09-15
Subject: Problems faced by Farmers
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Kaushalendra Kumar

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA

## UNSTARRED QUESTION NO. 269

TO BE ANSWERED ON THE 15 TH  SEPTEMBER, 2020

## PROBLEMS FACED BY FARMERS

269.     SHRI KAUSHALENDRA KUMAR:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंी be pleased to state:

- (a) whether it is a fact that India is a country which is widely famous for its agriculture throughout the world;
- (b) whether it is also a fact that our farmers are facing lot of problems like lack of basic amenities  of  irrigation  systems,  short  and  long  term  loan  facilities,  availabilities  of  high quality seeds and after sale of their produce on MSP;
- (c) whether exploitation of farmers at the hands of moneylenders is a very prominent and common issue that immediately needs to be looked into and if so, the details thereof;
- (d) whether  stories  of  farmers  committing  suicide  appear  in  the  media  almost  every day; and
- (e) if  so, whether the Government has any plan to revive the agriculture sector in the country?

## ANSWER

## MINISTER OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंी (SHRI NARENDRA SINGH TOMAR)

- (a): Agriculture is the backbone of the Indian economy.  54.6% of the total workforce is engaged in agriculture and allied sector (Census 2011) and it accounts for 16.5% of the country's Gross Value Added (GVA) for the year 2019-20. India is the largest producer of many fruit and vegetables in the world such as mango, potato and lady finger.
- (b): The Government through its various schemes and policies is providing assistance to  the  farming  community  such  as  irrigation  facilities  through  the  Pradhan  Mantri  Krishi Sinchayee Yojana.   Loan facilities are provided through the interest subvention scheme and  Kisan  Credit  Card.    The  availability  of  institutional  credit  for  agriculture  has  been raised to Rs. 15 lakh crore for the year 2020-21.  As far as requirement and availability of seed  is  concerned  for  Kharif  -2020,  the  requirement  is  150.52  lakh  quintals  and  the availability  is  153.70  lakh  quintals.  Procurement  through  MSP  has  also  increased manifold.  MSPs for all Kharif & Rabi crops from 2018-19 season are at a level of at least 150  percent  of  the  cost  of  production.  The  Government  is  constantly  endeavoring  to introduce measures to better the lot of farmers in the country.

- (c): In order to extend institutional credit to farmers / individuals so as to reduce their dependence on non-institutional sources including moneylenders, a number of steps have been taken by the Government which are at Annexure-I.
- (d): The  National  Crime  Records  Bureau  (NCRB)  under  the  Ministry  of  Home  Affairs compiles  and  disseminates  information  on  suicides  in  its  publication  titled  'Accidental Deaths and Suicides in India' (ADSI). These Reports on suicides upto 2019 are available on its website
- (e): Agriculture  is  a  State  subject.    However,  Government  of  India  supplements  the efforts  of  States  through  appropriate  policy  measures  and  budgetary  support.  A  3.4% increase in Gross Value Added of the Agriculture Sector was recorded in the first quarter of 2020-2021 despite the pandemic.  A list of various initiatives taken by the Government to revive the agriculture sector are at Annexure-II.

- (i) The Priority Sector Lending (PSL) directions of RBI mandate all Domestic Scheduled Commercial  Banks  to  earmark  18%  of  their  Adjusted  Net  Bank  Credit  (ANBC)  or Credit Equivalent amount of Off-Balance Sheet Exposure (OBE), whichever is higher, as on the corresponding date of the previous year, for lending to Agriculture including loans to farmers. Further, a sub-target of 8% for small and marginal farmers has also been fixed.
- (ii) Loans to distressed farmers and to other persons (not exceeding Rs.1,00,000/- per borrower) indebted to non-institutional lenders is an  eligible category under PSL, to enable them to repay their debt to non-institutional lenders.
- (iii) In  order  to  ensure  that  all  eligible  farmers  are  provided  with  hassle-free  and  timely credit  for  their  agricultural  operations,  Government  has  introduced  the  Kisan  Credit Card (KCC) Scheme,  which enables farmers to meet the short term credit requirements for cultivation of crops; Post-harvest expenses; Produce marketing loan; Consumption requirements of farmer household; Working capital for maintenance of farm assets and activities allied to agriculture; and Investment credit requirement for agriculture  and  allied  activities.  KCC  Scheme  provides  for  issue  of  ATM  enabled RuPay  debit  card  with,  inter  alia,  facilities  of  one-time  documentation,  built-in  cost escalation in the limit, any number of drawals within the limit, etc.
- (iv) Under the KCC Scheme, a flexible limit of Rs.10,000 to Rs.50,000 has been provided to marginal farmers   (as Flexi KCC)    based on the land holding and crops grown including  post-harvest  warehouse  storage  related  credit  needs  and  other  farm expenses, consumption needs, etc., plus small term loan investments without relating it to the value of land.
- (v) To enhance coverage of small and marginal farmers in the formal credit system, RBI has raised the limit for collateral-free agriculture loans from Rs.1 lakh to Rs.1.6 lakh.
- (vi) The requirement of 'no due' certificate has been dispensed with for small loans up to Rs.50,000 to small and marginal farmers, share-croppers and the like and, instead, only a self-declaration from the borrower is required.
- (vii) To bring small, marginal, tenant farmers, oral lessees, etc. into the fold of institutional credit, Joint Liability Groups (JLGs) have been promoted by NABARD.
- (viii) Reserve Bank of India (RBI) has issued directions for Relief Measures to be provided by respective lending institutions in areas affected by natural calamities which, inter alia, include restructuring/rescheduling of existing crop loans and  term loans, extending  fresh  loans,  relaxed  security  and  margin  norms,  moratorium,  etc.  These directions  have  been  so  designed  that  the  moment  calamity  is  declared  by  the concerned  District  Authorities,  they  are  automatically  set  in  motion  without  any intervention, thus saving precious time. The benchmark for initiating relief measures by  banks  has  been  reduced  from  50%  to  33%  crop  loss  in  line  with  the  National Disaster  Management  Framework.  Banks  have  been  advised  not  to  insist  for additional collateral security for restructured loans.
- (ix) Interest  Subvention  Scheme:  With  a  view  to  ensuring  availability  of  agriculture credit(including loans taken against KCC) at a  reduced rate of interest to  farmers, the Government of  India  had  introduced  an  Interest  Subvention  Scheme  for  short  term crop loans up    to Rs.3.00 lakh.    The    scheme is  implemented through Public Sector Banks, Regional Rural Banks, Cooperatives Banks including PACs and Private Sector  Banks.  Under  the  scheme,  2  percent  interest  subvention  is  provided  to  all farmers     and an  additional 3 percent incentive is given for prompt repayment of loan

reducing the effective cost of loan to 4 percent per annum on timely repayment.  The benefit  of  interest  subvention  is  extended  for  a  period  of  up  to  six  months  (postharvest)  to  small  and  marginal  farmers  having  Kisan  Credit  Card  on  loan  against negotiable  warehouse  receipts  to  prevent  distress  sale  of  produce.  The  benefit  of Interest  Subvention  has  also  been  extended  to  Animal  Husbandry  and  Fisheries farmers on loans for working capital under KCC upto 2 lakh.

- (x) The Central Government had launched on 24 th February, 2019, a new Central Sector Scheme, namely, the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) with a view to provide  income  support  to  the  farmers'  families  holding  cultivable  land  (subject  to certain  exclusions  relating  to  higher  income  groups)  to  enable  them  to  take  care  of expenses related to agriculture and allied activities as well as domestic needs so as to protect  them  from  falling  in  debt  trap  for  meeting  such  expenses  and  ensure  their continuance  in  the  farming  activities.  Under  the  Scheme,  a  financial  benefit  of Rs.6000/- per year is provided, in three 4-monthly installments of Rs.2000/- each, to the farmer families.

## List of various interventions and schemes launched for the benefit of farmers.

(i)    With  a  view  to  provide  income  support  to  all  farmers'  families  across  the  country,  to enable them to take care of expenses related to agriculture and allied activities as well as domestic needs, the Central Government started a new Central Sector Scheme, namely, the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN). The scheme aims to provide a payment of Rs. 6000/- per year, in three 4-monthly installments of Rs. 2000/- to the farmers families, subject to certain exclusions relating to higher income groups.

(ii) Further with a view to provide social security net for Small and Marginal Farmers (SMF) as they have minimal or no savings to provide for old age and to support them in the event of consequent  loss  of  livelihood,  the  Government  has  decided  to  implement  another  new Central  Sector  Scheme  i.e.  Pradhan  Mantri  Kisan  Maan  Dhan  Yojana  (PM-KMY)  for providing old age pension to these farmers. Under this Scheme, a minimum fixed pension of Rs.  3000/-  will  be  provided  to  the  eligible  small  and  marginal  farmers,  subject  to  certain exclusion clauses, on attaining the age of 60 years.

(iii)  With  a  view  to  provide  better  insurance  coverage  to  crops  for  risk  mitigation,  a  crop insurance scheme namely Pradhan Mantri Fasal Bima Yojana (PMFBY) was launched from Kharif 2016 season. This scheme provides insurance cover for all stages of the crop cycle including post-harvest risks in specified instances, with low premium contribution by farmers.

(iv) Giving a major boost for the farmer's income, the Government has approved the increase in  the  Minimum Support Price (MSPs) for all Kharif & Rabi crops for 2018-19 season at a level of at least 150 percent of the cost of production.

(v) Implementation of flagship scheme of distribution of Soil Health Cards to farmers so that the use of fertilizers can be rationalized.

(vi) 'Per drop more crop' initiative under which drip/sprinkler irrigation is being encouraged for optimal utilization of water, reducing cost of inputs and increasing productivity.

(vii) 'Paramparagat Krishi Vikas Yojana (PKVY)' for promoting organic farming.

(viii) Launch of e-NAM initiative to provide farmers an electronic transparent and competitive online trading platform.

(ix) Under 'Har Medh Par Ped', agro forestry is being promoted for additional income.  With the amendment of Indian Forest Act, 1927, Bamboo has been removed from the definition of trees.  A  restructured  National  Bamboo  Mission  has  been  launched  in  the  year  2018  to promote bamboo plantation on non forest government as well as private land and emphasis on value addition, product development and  markets.

(x) Giving a major boost to the pro-farmer initiatives, the Government has approved a new Umbrella Scheme 'Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PMAASHA)'.  The Scheme  is  aimed  at  ensuring  remunerative  prices  to  the  farmers  for  their  produce  as announced in the Union Budget for 2018. This is an unprecedented step taken by Govt. of India to protect the farmers' income which is expected to go a long way towards the welfare of farmers.

(xi)  Bee  keeping  has  been  promoted  under  Mission  for  Integrated  Development  of Horticulture (MIDH) to increase the productivity of crops through pollination and increase the honey production as an additional source of income of farmers.

(xii) To ensure flow of adequate credit, Government sets annual target for the flow of credit to the  agriculture  sector,  Banks  have  been  consistently  surpassing  the  annual  target.  The agriculture credit flow target has been set at Rs. 13.50 lakh crore for the F.Y.2019-20 and Rs.15.00 lakh crore for F.Y. 2020-21.

(xiii)  Extending the reach of institutional credit to more and more farmers is priority area of the Government and to achieve this goal, the Government provides interest subvention of 2% on  short-term  crop  loans  up  to  Rs.3.00  lakh.  Presently,  loan  is  available  to  farmers  at  an interest rate of 4% per annum on prompt repayment.

(xiv)  Further,  under  Interest  Subvention  Scheme  2018-19,  in  order  to  provide  relief  to  the farmers on occurrence of natural calamities, the interest subvention of 2% shall continue to be available to banks for the first year on the restructured amount. In order to discourage distress sale by farmers and to encourage them to store their produce in warehouses against negotiable receipts, the benefit of interest subvention will be available to small and marginal farmers having Kisan Credit Card for a further period of upto six months post harvest on the same rate as available to crop loan.

(xv)  The  Government has extended the facility of Kisan  Credit  Card (KCC) to the  farmers practicing animal husbandry and fisheries related activities.  All processing fee, inspection, ledger folio charges and all other services charges have been waived off for fresh renewal of KCC. Collateral fee loan limit for short term agri-credit has been raised from Rs.1.00 lakh to Rs.1.60 lakh.  KCC will be issued within 14 days from the receipt of completed application.

(xvi) Several market reforms have been rolled out. These include

- a.  Model APLMC (Promotion & Facilitation) Act, 2017
- b.  Establishment of 22,000 number of Gramin Agriculture Markets (GrAMs) as aggregation platforms
- c. Agri-Export Policy, that targets to double agri-exports by 2022
- d.  The  Farmers  Produce  Trade  and  Commerce  (Promotion  &  Facilitation)  Ordinance, 2020
- e.  The Farmers (Empowerment & Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020
- f. Amendments  to  Essential  Commodities  Act,  1955,  that  deregulates  various  agricommodities
- g.  Promotion of 10,000 FPOs by 2024

(xvii) Creation of Corpus Funds

- a.  Micro Irrigation Fund - Rs. 5,000 crores
- b.  Agri-marketing Fund to strengthen eNAM and GrAMs - Rs. 2,000 crores
- c. Agricultural  Infrastructure  Fund  (AIF)  to  build  agri-logistics  (backward  &  forward linkages) - Rs. 100,000 crores

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