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home >> global news >> global visionaries >> A Fate Worse Than Debt: The Plight of Indian Farmers

A Fate Worse Than Debt: The Plight of Indian Farmers
May 16, 2007

by Palagummi Sainath print version
print version (graphics)
Reprinted Coutesy of The Hindu Newspaper

"The tea in Kadapa jail was better than the chai we get here in Garladinne mandal. But the rest of the food was awful," says M. Nallappa Reddy. His brief sojourn behind bars has made this man in his Sixties a minor celebrity in this State. Not so much because he liked the tea in Kadapa jail. But because many see his experience as the revival of an ominous trend: the jailing of bankrupt farmers for debt in Andhra Pradesh.

"It happened before during the time of Chandrababu Naidu's government, it is happening again now. More aggressively," says Malla Reddy, general secretary of the Andhra Pradesh Ryuthu Sangham (APRS). "Banks are turning the screws on hard-up farmers, sending them to jail. Mind you, these are farmers in drought-hit regions with no crop and no capacity to pay. The same banks won't touch big industrialist defaulters who owe them crores. But farmers owing a few thousand rupees go to jail." Till recently, the website of the A.P. Debt Recovery Tribunal listed some 200 names of VIPs, industrialists, contractors, and politicians owing over Rs.1,000 crore to the banks. The money was not recovered but the site seems to have vanished.

"I did try to repay," insists Mr. Nallappa Reddy. To clear the loan he took more loans at high interest rates from private lenders. "The principal sum I owed the bank was Rs.24,000. I paid Rs.10,000 in court and went back to pay another Rs.24,000. I could not manage the Rs.1 lakh the Anantha Gramina Bank was demanding. How could we, after a decade of failure in agriculture? So I hoped they would accept the Rs.34,000 under the One Time Settlement (OTS) scheme."

The bank did not accept the OTS deal. "When I went to court last October to pay the Rs.24,000, I was remanded and sent to Kadapa jail." There, he says: "I met at least six others in the same situation as I was. Two of them owed this same bank money." Many more were in line for arrest, he says, and believes the District Collector helped avert that - for now. "Jail was interesting. One woman came to have her husband released. He was there on a charge she filed against him. A little boy beside me turned out to be there on an arrack case. My neighbour was a burglar."

Common experience

In other respects, Mr. Nallappa Reddy's story is the same as that of millions of other farmers. As input costs shot up and bank credit declined in the past decade, he incurred heavy losses. As "water, electricity and other costs rose, things got worse." Then the water ran out. "I sank 32 borewells in ten acres within four or five years. All of them failed." This mandal shot to fame in 2004 when, desperate for water, farmer Chandrashekar Reddy sank four borewells in a graveyard linking it to his fields with an 8-km pipeline. (July 18, 2004.) He has since died. Ironically, a couple of those wells now yield some water, after their owner has himself gone to the grave.

Mr. Nallappa Reddy is unusual, though, in one other way. He quit the lorry business in the 1970s, betting on agriculture. "Then, the future seemed bright. I sold my lorry and was the first to start grape cultivation here in Thimmampetta village, on my family's 12 acres. Things were good till the '90s." But "the last 15 years have crushed us. All government policies work against the farmer. All farmers here are in the same condition."

"His arrest was not such a simple issue. The media have played it up without looking at the bank's problems," says an exasperated M.R. Vani, branch manager of the bank here. After two mergers, it is now called "The Andhra Pragati Gramina Bank." Mr. Nallappa Reddy, says Ms. Vani, "was a long-time defaulter. Only after ten years of waiting did we file a suit against him. Yes, he did ask for a settlement, but with a tiny amount. We asked him to improve his offer as the then head office was unable to accept it. Meanwhile court proceedings took their own course and we could not stop that."

Ms. Vani herself is otherwise quite sympathetic. "Now also, recovery is a problem. There have been no rains, no income, extended drought. And no alternative source of income is there for the farmers. Which is why our bank is encouraging them in other directions, too. We must give agricultural loans, of course. But we also give loans that seek to create other income." She knows things are hard. "We've brought down the number of defaulters like him in this branch by half. But there are still over 100 of them."

Press coverage helped

Media coverage following his arrest ensured Mr. Nallappa Reddy's early release. He was out in a week. Others were not so lucky. "I spent a full month inside," says Gengi Reddy in Kadiri mandal. He too went to Kadapa central jail. "That was in the time of Chandrababu Naidu's government. I too, tried for a settlement whereby I paid back both principal and more. I even offered them some of my six acres to sell and recover the money. But they [the Kadiri branch of the same bank] told me flatly: `we don't want your land. Only cash. You should go to jail.'" He did. And has since sold off irrigated land to clear his debts.

"This practice has now revived," says Mr. Malla Reddy. "In Mahbunagar district, just two months ago, a Dalit farmer and an OBC farmer spent two weeks in jail. This time, the State Bank of India was involved. Again, drought-hit farmers with no ability to repay."

They were only released when their families borrowed more money from usurers to pay off their bank debts. All those who have been to jail speak of meeting others in there for the same reasons.

Mr. Nallappa Reddy was more fortunate. "His neighbours love him," says one of them. "The publicity he got stopped a lot of us from also going inside." The question is: for how long? "The banks are getting more forceful now, as you can see from the Telangana cases," says Mr. Malla Reddy. "This matter can explode one day."

"The government is not interested in us," says Sainath Reddy, a nephew of the man who sank borewells in the graveyard. "They want corporate agriculture. We are a nuisance in the way. I tell you, those you wish well, ask them to stay away from agriculture. Don't even wish it on your enemies."

A Glossary of Terms

A crore = ten million

crorepati = multi-millionaire

Andhra Pradesh = southern Indian state that has seen thousands of farmers suicides in the past eight years.

Andhra Pradesh Ryuthu Sangham = A left-wing farmers' union

District Collector = top administrative official of a district

Chandrbabu Naidu = former chief minister of Andhra Pradesh, most beloved of any third world leader for MNCs.

41 rupees approx = one US dollar


[Reprinted with the kind permission of the author.]

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *


Palagummi Sainath

Sainath is the rural affairs editor of The Hindu newspaper and the author of Everybody Loves a Good Drought. He can be reached at: psainath@vsnl.com. See India Togther for access to many articles by Palagummi Sainath on India's farming crisis and the plight of the dalits.

Read more of Sainath's articles at Satya Center on the Palagummi Sainath Archive.




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