“The
Deputy Chief Minister has got it wrong. He should not be persecuting and
prosecuting the moneylenders (reference is to the recent move of the Government
of Maharashtra against money lending).. After all without money lenders how can
agriculture survive” … these
astounding words are from a young farmer, also a political activist, from Bhatumba a small village in the Yavatmal
district of Maharashtra. We were shocked to say the least… One expects seeds,
fertilizers, and labour to be essential for the practice of agriculture
but MONEYLENDERS? That was a new one… We decided to explore… This is
what we saw…
Over the last many
years the credit situation in the rural areas has worsened. Frequent spells of
drought, increasing inputs costs, poor use of technology have made agriculture
unproductive. We have covered this in detail in an earlier report. Corruption,
inefficiencies, political interference have made credit co-operatives and banks
(co-operative) nearly defunct. Every 10 kms one will find a failed financial
institution. These institutions are leaving rural areas in droves. Almost all
the farmers are indebted and defaulters to a certain extent. Some of the
‘smarter’ farmers play the waiting game by deliberately defaulting on loans. As
a large farmer with an outstanding loan of Rs. 400,000/- said to us “why should I bother to pay off the loan? All I need to do
when the demand for repayment comes up is pay the bank officer Rs. 5000 under
the table. That takes care of the problem for one year. Next year maybe the
government will write off loans or else the same formula will work. It is
cheaper to do this than to pay”.
Against this backdrop
is the undeniable truth that very few farmers can undertake agricultural
activities without accessing credit. This is especially so because inputs have
to be bought most of the time and labour paid regularly. Often it is a
matter of survival for the family till the harvest comes in. In this scenario
is it any wonder that the moneylender becomes an important input
into agriculture. We saw rates ranging from 5% to 20% a month.. In 2004 apparently there was no credit
available even at 25% a month. With interest rates at these levels how much cash
profit can the farmer expect from rain-fed, small and marginal landholding?
Farmers are turning to
women's self help groups as an avenue for accessing easy credit and at much
more affordable terms. Compared to the moneylenders the normal SHG rate of 2%
per month makes the loan almost FREE. Accessing credit then becomes the sole
purpose of forming SHGs of women! These SHGs exist only on paper and are run by
men themselves. We have seen 19 SHGs groups of women in one village of less
than 1000 population…. None of these were meant to mobilize and empower women.
None had regular meetings though savings records and minutes were impeccable.
This puts paid to the entire concept of women's empowerment that the SHGs are
supposed to (and touted to) foster. The
banks are slowly strangling this line of credit as well by linking default of
men to women's SHGs. Genuine groups also suffer because of these policies as
all of us would have seen some time or other. Families are thus pushed back
into the welcoming arms of the moneylenders. In the next report we will look at
women's SHGs, their economic activities and ultimate impact on lives in more
detail.
Another pattern we
have seen in Yavatmal is that of concentrated landholding. Few families hold
most of the land, a few are small farmers and rest are landless labourers. In
Bellora, a village of around 2000 souls (350 families), for instance, 75% of
the land was held by 8-10 families with the remaining 25% being held by another
25-30 families and the rest being landless. There were no other livelihood
opportunities in the village. Still there was no significant migration. When
investigated, we realized that the actual act of farming is managed by the
landless for the landed gentry. They are employed on monthly (Rs. 900 + one bag
of jowar) or yearly terms (8000 + 12
bags of Jowar) basis. The landowner does nothing but supervise leaving himself
free to indulge in politics or other pursuits. In reality the landless are
bonded but don’t realize it. The landlords are taking care to ensure that
the landless are kept at an optimum level… just enough to prevent revolt and
not too much to make them independent…
The landless rarely have any disposable income left to think of
education or health of their children who are consequently consigned to the
same fate… They drop out of school at a young age and get into the workforce.
The invidious cycle is thus self-sustaining…
Is it any
wonder that most farmers want their children to get out of agriculture and get
JOBS?
The MAHARASHTRA
VIKAS NIDHI (MAHARASHTRA DEVELOPMENT FUND) awaits contributions from all of
you… Watch this space for further updates. Do also watch the updated
blog at www.greenearthconsulting.org/padayatraprogress.htm.
Also read a compilation of some stories on www.empowerpoor.org
grnearth@vsnl.com, 020-25466103,
09422521703
Dushkaal Hatawu :
Manoos Jagawu
(Eradicate Drought :
Save Humanity)
February 23, 2006