Prime Minister of India - Dr. Manmohan Singh

PM announces series of measures to alleviate farmer distress in Vidarbha

"I have been travelling for the last two days in Vidarbha to see at first hand the distress of farmers in this region. I visited Dhaman Gaon in Amravati District, Waifed in Wardha District and Yavatmal. I had an opportunity to interact with families and widows of farmers who had committed suicide and also heard many farmers who were in acute distress. The interactions have left a deep impression on my mind. The farmers who form the backbone of the economy of these districts, are in acute distress forcing many of them to take the extreme step of committing suicide when they see all avenues for relief blocked.

The causes of the crisis seem to be many. The primary ones seem to be continual crop failure, low yields, poor irrigation, medical expenses, cost of weddings in families, delays in getting electricity connections, and unremunerative prices. These have pushed many farmers deep into debt and my heart was moved when I heard the harrowing tales of suicide affected families who were struggling to educate their children.

We need to take steps to provide immediate relief to the farmers of the region. The immediate priority must be to restart the process of credit flow so that farmers can resume normal agricultural activities and obtain regular livelihood. For this, we need to address the issue of debt relief. At the same time, we need to address the long term issues of enhancing livelihoods by providing additional avenues of income and improving the prospects for agriculture so that agriculture can become a viable enterprise.

We are announcing a series of measures for the 6 affected districts of Vidarbha namely, Amravati, Wardha, Yavatmal, Akola, Washim and Buldhana.

Immediate Relief

The suffering of families affected by suicides and of debt stressed farmers are immense and they face innumerable problems in carrying on with their daily lives. I have heard mothers crying to meet their children's costs of education, fathers struggling to meet health expenses. I propose to place a sum of Rs. 50 lakhs each at the disposal of each Collector in the 6 suicide affected districts to be used judiciously for alleviating the distress of such families. This would be released as a grant directly from the Prime Minister's National Relief Fund.

There is a cry all around for providing relief from debt. In many cases, the overdue interest exceeds the original loan. The overdue interest in the 6 affected districts is around Rs.712 crores as on June 30, 2006. The entire overdue interest will be waived and all farmers will have no past interest burden as on today so that they will be immediately eligible for fresh loan from the banking system. The burden of this will be shared equally by the Central and State Governments.

In addition to waiving overdue interest, Rs.1300 crores of overdue loans as on June 30, 2006 will also be rescheduled over a period of 3-5 years with a one year moratorium.

We will ensure an additional credit flow of Rs.1275 crores in 2006-07 in the 6 districts. Special Teams will be deputed from NABARD and the lead banks to ensure this.

Long Term Relief Measures

There is a crying demand all around for improving irrigation. We are allocating Rs.2177 crores from the Central Government for completion of major, medium and minor irrigation projects in these districts over the next 3 years.

There seems to be a problem of quality inputs, particularly in cotton. A massive Quality Seed Replacement Programme costing Rs. 180 crores will be started so that the problem of obtaining quality seeds is reduced.

Rs. 240 crores will be provided for watershed development, check dam construction and rain water harvesting in the 6 districts.

Vidarbha has been known to be the orange capital of India. There seem to be problems in orange cultivation. The National Horticulture Mission will cover all the 6 districts including Buldhana and the problems in orange cultivation will be addressed. Over Rs. 225 crores will be spent for this purpose.

Drip and sprinkler irrigation will be expanded extensively to cover over 50,000 hectares in these 6 districts.

It is extremely important that farmers have additional sources of livelihood in addition to farming. We propose to start a major programme costing Rs.135 crores for improving the cattle and fisheries activities in these districts. Hopefully this would ensure that there would be parallel streams of income which would reduce the dependence on agriculture.

I do realise that the success of this approach depends on the implementation. In addition to state and local implementation and monitoring mechanisms, my office will monitor implementation of the package of relief measures. I have already asked my Principal Secretary to take a meeting of the officers concerned to avoid bureaucratic delays.

The Problem of Indebtedness

In addition to providing interest waiver and debt rescheduling in these districts, I recognize that there is a nation wide problem of agricultural indebtedness. This is the result of a variety of factors and has many consequences for the agriculture sector as a whole. We need to treat this as a national problem and address it on a war footing. We need to ensure that our farmers become bankable once again so that they can cultivate their land without falling into the clutches of money lenders and their extortionary interest rates.I recognize that there is a problem of debt overhang which we need to address if we have to revive our farming community.

I have discussed this matter with the Finance Minister and the Agriculture Minister. The Government will be setting up an Expert Group in the next few days to look into the problem of agricultural indebtedness in its totality and suggest measures for providing relief to farmers across the country. I expect the Expert Group to give its recommendations in the next 3 months after consulting State Governments. Based on its recommendations, our Government will take effective measures to ensure that the farming community is provided substantial relief from its debt problem.

Nagpur Specific Announcements

Nagpur has an airport which is centrally located and has the potential to be a transport hub. It has already been made an international airport. Boeing is setting up a maintenance facility here. I have discussed the matter regarding the development of Nagpur airport as a Multi-Modal Cargo and Travel hub. The Ministry of Civil Aviation has assured me that they will work in cooperation with and support all efforts of the Government of Maharashtra to develop the airport including the transfer of any assets to the State Government.

Irrigation is a pressing need of the region. The Indira Sagar Dam and the Gosi Khurd Project are close to the hearts of the people of Nagpur. Its foundation stone was laid by the late Shri Rajiv Gandhiji. I request the Government of Maharashtra to speed up the work on the project and we will provide all necessary assistance from the Government of India for the speedy completion of the project.

As for other issues regarding the development of Nagpur, this city is part of the Jawaharlal Nehru Urban Renewal Mission and I request the state to utilize this window to the maximum extent. If Nagpur develops rapidly, I am confident that this will improve the economic prospects of Vidarbha as a whole."