The explosive issue goes beyond loan waivers that provide temporary relief. Perhaps it’s time for regimes to look the problems with care
Twitter is often turning into a microcosm of an illogical, juvenile and obtuse India. While it is evident almost every day — watch what's trending and you are acutely amused — this was at fine display during the recent farmers’ unrest at Mandsaur, Madhya Pradesh. Some Twitter activists took to the platform with vengeance and battered the Bharatiya Janata Party (BJP) Government in the State and at the Centre with uncouth arrogance.
Turning overnight champions for farmers' cause, they took exaggeration to a new level by portraying how farmers were being killed and denied their rights. While it is certain that many of these Twitter activists would never have seen a village in their lifetime, what is worrying is how even serious issues are being dealt with a reckless superficiality and how mainstream political parties, in desperate bid to gain brownie points, are becoming criminal accomplices.
The farmers’ issue goes far beyond the farm-loan waiver and must be looked at with utmost care. It has been debated endlessly and repeated many times over that farm-loan waiver is just one tiny, momentary and populist form of relief to the farmers. It is akin to giving an aspirin to a person who has been complaining of severe headache caused by brain fever. While it may give momentary relief, to cure this potentially fatal disease you require heavy doses of antibiotics.
Aspirin, however, continues to be served unabated with the Punjab Government joining the race on providing ‘relief’ to farmers on June 19. Claiming to provide “double the relief announced by States of Uttar Pradesh and Maharashtra” Punjab Chief Minister Captain Amarinder Singh announced crop-loan waiver of upto two lakh rupees for small and marginal farmers having less than five acres of land holding, and also a flat two lakh rupees waiver for marginal farmers having bigger land holdings.
Even as populism may be integral to modern politics, when it is devoid of sound economic principles, it is fraught with severe consequences. One of the highly disliked Prime Minister, VP Singh, sowed the seeds of this faulty populism. While many may still blame him as an architect of creating an unprecedented social divide with the implementation of the Mandal Commission recommendations for reservations, not many may know that Singh had announced a Rs10,000 crore farm-loan waiver way back in 1990. Singh was in fretful hurry to go down in history as a reformer Prime Minister, and his actions were crafted around this. The Indian Council for Research on International Economic Relations in a report noted that this waiver affected rural credit with defaults of such a high magnitude that it took the banks several years to recover from its impact.
What's worse is that 18 years later, an erudite economist followed the faulty diagnosis and medication of a hurried politician. In 2008, the then Prime Minister Manmohan Singh announced a farm-loan waiver of Rs52,000 crore ahead of the 2009 general election. The Comptroller and Auditor General of India later pointed out that there were many problems with this programme, including benefits accruing to farmers with non-agricultural loans. Uttar Pradesh, Maharashtra and Punjab may have erred, yet again, in following a fallacious prescription — an aspirin over antibiotics.
looking at the fine print of Prime Minister Narendra Modi one does find an approach to address farmers’ issue holistically than by piecemeal. The mission on doubling farmers income by 2020 is supported by a slew of programmes including increased budgetary allocation by about Rs5,000 crore in 2017-18. Through Krishi Dak service, farmers are getting good seeds at their doorstep; over six crore soil health cards have been distributed; the neem coated urea is a reality today which has capped pilferage and misuse; Pradhan Mantri Fasal Bima Yojna focuses on providing inexpensive insurance for wide coverage, making farming as risk-free as possible; electronic-National Agriculture Market, a pan-Indian e-trading platform has been launched to create a unified national market for agricultural commodities.
If there were any doubts lingering, Union Minister for Finance, Arun Jaitley recently made it clear about the Union Government’s intent that it would not be a part of the State's fiscal leverage in waiving farm loans and that the cost has to be borne by the States.
(The writer is a strategic communications professional)