After the loan-waiver, bracing for next loan

After the loan-waiver, bracing for next loan

TINDWANI,BARABANKI: Hori Lal is worried. At 70, he is old and frail. He speaks, but is not easy to always comprehend. He walks slowly. But it is not just about himself that he is anxious. He is more concerned about the well-being of his family comprising three sons, their wives and 10 grand children.

“If one person falls sick, we are in trouble. There is no money,” says Lal, a farmer in Barabanki’s Tindwani village. Though just 20 kilometres from Lucknow, if you go by the lack of infrastructure and housing, the state of roads and power, the village could be anywhere in the remote interiors of UP.

Lal has a loan of ₹70,000, taken in 2015, and displays his Kisan Credit Card. He is also a potential beneficiary of the UP government’s loan waiver. Even as he waits to see whether his loan will indeed get written off as assured by Yogi Adityanath, the state’s new chief minister, he is already thinking of the next loan that he will likely be forced to take.

The fact that he may have to take another loan underlines the limitations of a loan waiver: it at best can be a temporary relief and is not a solution to the problem of low income farmers plagued by recurrent losses.

ECONOMICS OF INVESTMENT Lal, for example, has 6 bighas, an acre and a half, of land. The single-most important challenge for him, every season, is finding the resources to invest.

Take the economics of potato farming.

For an acre of land, Lal – like other potato farmers in Tindwani and elsewhere – has to first buy 20 sacks of seeds, with each sack containing 50 kg. Each kg costs around ₹ 24. And so the total cost for seeds is ₹24,000.

He then has to buy fertilisers of different kinds – a 5 kilo pack of zinc sulphate for ₹ 300, two packs of urea for ₹ 330 each, and five sacks of DAP (Diammonium Phosphate) for ₹1,150 each. The total cost of fertilisers comes to ₹6,710.

After the loan-waiver, bracing for next loan

Lal then has to till and level the land, for which he hires a tractor for ₹500 per hour. Ten times, for two hours each, the tractor works on preparing the soil and land. Lal shells out another ₹10,000 for it.

He then sows the seeds, for which he has to hire the tractor again, which costs him ₹2000.

The farmers of Tindwani depend on pumps, run on diesel, for irrigation. Engines (which includes diesel rates) can be rented at ₹150 per hour; every acre requires at least four hours of irrigation; and it has to be irrigated seven times. The total cost for Lal on this head works out to ₹4,200.

The next step is the use of pesticides. Along with labour, which can be hired at ₹250 per day, the costs of this would come to ₹1,500.

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