INDEX

SR. No. Chapters Pg. No.

1. Introduction 3

2. The Core Problem 4-7

3. Response of the Government 8 - 11

4. Graphical representation of facts 12

5. Farmers seek mercy killing 13

6. Suggested Remedies 14

7. Biblography 16

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INTRODUCTION

It must also be remembered that the Vidarbha crisis

does not go too far back in history. In the memory of the
present generation, there was a time, not long ago, when
Vidarbha was considered a richer region than Western
Maharashtra. That was the time when people in Western
Maharashtra prided themselves on marrying their daughters
to grooms from the Vidarbha area. The tragedy in Vidarbha
started somewhere around 1960s, when Vidarbha joined the
State of Maharashtra as the result of a gimmick of the
political party to which the Prime Minister belongs, to ensure
the rule of the Congress in Maharashtra and, particularly, in
Mumbai. After Vidarbha joined Maharashtra, the State
government took a number of rapid measures that resulted
in the exploitation of the raw materials produced in Vidarbha,
which is, of course, famous for its oranges and well-known
for white gold, that is cotton. The region is also rich in coal,
uranium and iron. It is the major producer of thermal
electricity.

All these features were exploited for the benefit of of the

industrially advanced Mumbai city and Western
Maharashtra. The Maharashtra State Cotton Monopoly
Procurement Scheme, for example, has been solely
responsible for the loss of around Rs 30,000 crore to the
farmers of Vidarbha since its inception about 30 years back.
Similarly, the power generated in the area, and the coal and
uranium mined there are taken away on terms of trade that
are patently disadvantageous to the region.

These are the chief causes of the misery but, more

important, the farmers have been affected because they
could not get a price for their cotton that was available in the

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open markets of the adjoining States of Madhya Pradesh,
Andhra Pradesh or Gujarat. Cotton, the main produce of the
farmers in Vidarbha, also happens to be one crop on which
the Government has imposed the maximum negative
subsidy for several years by keeping prices deliberately
depressed in comparison with the international markets.

The cotton farmers lost, year after year, and got further and
further indebted. This is the chronic malady, manifesting
itself several years later in the form of a spate of suicides.

The farmers can stand some level of indebtedness. What

they have difficulty in withstanding is the public humiliation
and social stigma heaped on them by certain types of
creditors. Unlike what is popularly believed, the private
moneylenders have little ability to enforce cruel coercive
methods for recovery of their loans because they have to live
in the villages and have to be aware of village sensibilities.
The commercial banks are not prone to using harsh methods
of recovery, either. In most cases, the farmers are driven to
suicide mainly because of the coercive methods used by the
co-operative bank recovery officials, who feel that they have
the necessary political support.

Another interesting aspect is that almost all the suicides are

of land-holding farmers. There are very few, if any, landless
labourers who have committed suicide. This proves that
while the economy of cotton may have been hard hit, the
brunt of it is borne by the land-holding farmers, who bear the
risk of both natural calamities and governmental tyranny. The
landless labourers might get poor wages, but there are no
deductions made subsequently on account of the failure of
crops or fall in market price. That is why land-holding farmers
are much worse off than the landless labourers, in general.
Enthusiastic announcements in favour of the aam aadmi

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might ignore this fact and do the land-holder farmers an
injustice.

THE CORE PROBLEM

In the Vidarbha region, the cotton belt of Maharashtra , over

980 cotton farmers have committed suicide between 2001
and 2006. Of the 3.4 million cotton farmers in this region,
95% are believed to be struggling with heavy debt, according
to Jan Aandolan Samiti.
Cotton is an important commercial crop grown in
Maharashtra constituting around 15 of the gross cropped
area, accounting for the highest area under cotton in the
whole country. Nearly 97% of the cotton cultivated in
Maharashtra being unirrigated, yield from cotton is lowest
and much below the all-India average. While the all-India
yield was 191 kg per hectare in 2000-01, the yield in
Maharashtra during the same period was 100 kg per
hectare.
The four major cotton growing districts of Akola , Amravati ,
Buldhana and Yavatmal together constituted 43% of the area
in the state. For most farmers in this region, cotton is the
primary cash crop and therefore the principal source of
income. However, this has turned out to be most
unremunerative in the last decade.
The Maharashtra State Agricultural Prices Committee data
shows that for the year 2002-03 the cost of production of H-6
variety was Rs 2357.61/- per quintal whereas the Minimum
support price (MSP) announced by CACP was Rs 1875/- per
quintal. Again with respect to NHH-44 and LRA-5166 while
cost of production was Rs 2318.84/- and Rs 2185.33 per
quintal respectively, the MSP was Rs 1620/- and Rs 1750/-
per quintal respectively. This indicates that the MSP fixed is
about 20 to 30% lower than the cost of production.

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(Sangeeta Shroff, GIPE, Pune, Cotton Sector in
Maharashtra ).
The newly introduced, genetically modified seed, Bt.Cotton,
that was enthusiastically endorsed by the government has
wreaked havoc on cotton farmers' lives. Its manufacturer,
Monsanto, said it was resistant to boll weevil - the main
cotton pest - and required just two sprays of insecticide for
every crop, instead of the usual eight. This seed sold for
about four and a half times the cost of normal seed, but
many farmers opted to buy it because they believed it was
indestructible and would give a higher yield. They were
devastated when many of the Bt cotton plants were afflicted
with a reddening that destroyed much of the crop leaving the
farmers with unusually high debts.
On the one hand promoting multinational giants such as
Monsanto, the government has withdrawn market controls,
tariffs and subsidies for agriculture under the diktats of the
World Bank. This is done without providing proper
infrastructure such as irrigation and marketing facilities. This
has pushed Indian farmers to compete with farmers in the
United States and the European Union who are protected by
trade restrictions and provided with billions of dollars as
subsidy. The 2002 Farm Bill in the U.S. alone gave $190
billion to large companies growing cotton, wheat, corn,
soybean, rice, barley, oats and sorghum.
Ten years back, the international price of cotton lint was
$1.10 a pound ($2.42 a kilo) but now it is 52 cents. The retail
price of cotton then was Rs.40 a metre, and it is now Rs.80.
Retail prices have doubled but farmers are forced to sell
their produce at half the price.
The Central Government can protect cotton growers from
imports and crashing international prices by hiking the import
duty on cotton. But this is not done. At present it is only 10%.
With respect to imports of cotton, since 1970 they were
canalized through Cotton Corporation of India . However, in

5
April 1994, keeping in tune with globalisation, cotton lint
imports were placed under open general license (OGL) i.e.,
they were freely importable. Further, from July, 2001, raw
cotton exports were also under OGL. With international
prices being depressed there is hardly any scope for the
Maharashtra Federation which was holding large stocks of
cotton to capitalize on exports. (Sangeeta Shroff, GIPE,
Pune). Falling global prices coupled with a low 10% import
duty, made imports cheaper; imported cotton now sells at Rs
17,000 a bale compared to Rs 19,000 for Indian cotton. As a
result more cotton is imported in the past five years than in
the previous two decades.
The Maharashtra Monopoly Cotton Procurement Scheme
set up in 1972 to purchase cotton from the state's 30 lakh
cotton farmers has been systematically scarped since 2002
to allow the private traders to have their heyday (see box).
Cost of production being much higher than the prices, most
farmers are running up huge losses and have to borrow
heavily. Since most of them have defaulted on loan
repayments the banks are unwilling to extend fresh loans.
Their only recourse is to borrow from the trader-moneylender
at 60 to 120% interest. This has ensured that the farmers are
trapped in debt.
A report submitted to the government of Maharashtra by the
Indira Gandhi Institute of Development Research, Mumbai
during January 2006 on Suicide of Farmers in Maharashtra
by Srijit Mishra has found out that the suicides are triggered
by the import policies of the government and the resultant
debt trap of the farmers. The study was focused in three
districts in Vidharba region namely Wardha, Washim and
Yavatmal.

6
RESPONSE OF THE GOVERNMENT

Alarmed at the phenomenal scale of farmers' suicides, Chief

Minister of Maharashtra announced farm loans at the rate of
6% interest, 1% less than the previous rate. He also
announced that, "If a farmer repays the loan on time, he will
get an additional subsidy of 2% in the interest rate and state
will bare the cost of giving loans to farmers at subsidised
rate." This announcement is a farce as the farmers are
already with high debt burden that they are unable to repay.
In the absence of remunerative prices the farmers cannot
repay the loan. 1% reduction in the interest will hardly relive
the farmers from the large gap between cost of production
and prices. A recent study by the state-run National Bank for
Agriculture and Rural Development (Nabard) revealed that
small and marginal farmers holding up to five acres were
more vulnerable. And borrowings from institutional and non-
institutional sources were almost equally responsible for
farmers' indebtedness. The average outstanding per sample
farmer was Rs 38,444. Given that most of the farmers are
indebted to the non-institutional sources of credit, there is no
strict action to curtail the private moneylenders.
Besides financial relief, the state government is trying to
uplift the morale of farmers by organising social events like
prayer meetings, plays, talks by experts etc. Instead of
addressing the root causes, efforts to start counselling
camps for the farmers, asking them to join Art of Living
classes, or attend morning bhajans is a cruel joke on dying
farmers.
While the state government packages are yet to take off,
there is yet another package for the suicide prone states
announced by Pawar which is almost on similar lines.

7
AS THE Vilasrao Deshmukh government celebrated its third
anniversary of coming to power in Maharashtra, claimed all-
round success and painted a rosy picture of the Vidarbha
relief package, ten more distressed farmers committed
suicide in the last 48 hours. This was said to be on account
of the delay in implementation of the relief package.
Just a week ago, the Maharashtra government appointed
another Study Panel headed by the well-known economist
Narendra Jadhav to ascertain the reasons behind the
Vidarbha farmers’ suicide and the impact of the Rs 3,700-
crore relief package announced by Prime Minister
Manmohan Singh last year for farmers who committed
suicide in six districts of Vidarbha. Within 48 hours of the
appointment of the Panel, seven more distressed farmers
committed suicide.
The number of farm suicides in the six districts of Vidarbha is
fast approaching the 1000 mark; there have been 988
suicides so far, this year. This implies an average of 98
suicides per month. According to official figures, 3,715
farmers from the Vidarbha region have committed suicide
since Jan 1, 2001, on ac-count of debt and crop failure.
What became of the study reports that the TATA Institute of
Social Studies, the Indira Gandhi Institute of Developmental
Studies, the National Farmers’ Com-mission, the Planning
Commission, YASHDA, Pune and the Gokhale Institute,
Pune submitted to the government on the issue before the
government appointed the Narendra Jadhav committee? Or
for that matter, the mega report the government of
Maharashtra itself came out with, after a ‘detailed’ study?
The Maharashtra government consigned all of them to the
dustbin!

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Besides, there are reports from 46 universities and
institutions analyzing the reasons that led farmers to suicide
and suggesting remedial measures. If anything, the
Maharashtra Chief Minister’s package announced on
December 10, 2005 or for that matter, the Prime Minister’s
package, seems to have actually accelerated the tempo of
suicides.
After being pulled up by the Bombay High Court in 2003-04,
the Maharashtra government asked the TATA Institute of
Social Studies (TISS) to submit a report on Vidarbha farmers
which it did. It also recommended remedial measures in its
report. But the government never gave a serious thought to
the report or its recommendations.
Subsequently, another high-profile institute, the Indira
Gandhi Institute of Developmental Studies, was asked to do
the same job. In came another detailed report which the
government promptly consigned to the dust bin.
Then in October -2005, the Prime Minister Manmohan Singh
asked the Chairman of the National Commission of Farmers
(NCF), Dr M S Swaminathan, to tour Vidarbha and submit a
report. He toured the region and submitted his report, which
was also not implemented.
In March 2006, a team from the Planning Commission,
headed by Adarsh Mishra, rushed to Vidarbha. It also
submitted a detailed report which went the way of the other
reports.
In the meanwhile, consequent upon the dressing-down it got
from the Nagpur bench of the Bombay High Court, the
Maharashtra government conducted a mega survey of 8,560
villages and 2 million farm families. According to the re-port,
2 million farmers were in deep distress and 4 million farmers
were in complete distress.

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Consequent upon the reality check, the Prime Minister
rushed to Vidarbha during June-July, 2006 and released
Rs.3750 crores by way of relief which too failed to stop or at
least curb, farm suicides in Vidarbha. As a face-saving
exercise, the Maharashtra government commissioned two
more studies by a couple of high-profile, Pune-based
institutes, viz., the YASHADA and the Gokhale Institute of
Management Studies. But their reports were never ever
perused by the administration.
The Vidharba Jan Andolan Samithi leader Kishore Tiwari
ridiculed the appointment of another committee. “What is the
use of asking the economists now to work towards a solution
to the agrarian crisis when the government is not
implementing any recommendation?” he asked and alleged
that it was only a time- buying exercise. He said that loan
waiver could be only part of the relief but not the solution to
the Vidarbha agrarian crisis. Issues relating to the price of
cotton, sustainable farming and the Food Crop Promotion
Programme need to be settled, he added.
After the Union Agriculture Minister Sharad Pawar pushed
for complete loan waiver as part of the relief measures of the
dying Vidarbha farmers, Maharashtra Chief Minister Vilasrao
Deshmukh clarified that the government was pushing the
Centre for complete waiver of loans owed by the Vidarbha
cotton farmers.
Even as the government dilly-dallied in issuing an official
announcement to this effect, farm suicides continued in the
Vidarbha region at the rate of three or four per day. The
Maharashtra government has already decided in principle to
release relief at Rs.1500 per hector (subject to a maximum
of 5 hectors) to all cotton growers but the ‘babus’ at
Mantralaya are delaying the implementation of this decision
too.

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11
FARMERS SEEK MERCY KILLING

16 July 2006 : Finding no way out of their miseries, thirty-five

farmers from Vadhona village in the Vidarbha region have
written a letter to President A P J Abdul Kalam, seeking
permission for euthanasia as local authorities have failed to
look into their problem for the last 20 years.

"We would like to end our lives instead of suffering crop

losses every year," they said in the letter, which they claimed
to have faxed to the President on Saturday.

The distressed farmers have sent copies of the SOS letter to

Maharashtra chief minister Vilasrao Deshmukh as well as
governor S M Krishna.

The Vadhona farmers have written that a river passing by

their fields has been destroying farms every year. For the
last 20 years they have been raising the matter and seeking
help from district authorities as well as local elected
representatives but to no avail, the letter notes.

Only last year, a farmer from the village, Punaji Nare,

committed suicide because of unending crop losses. His son
Subhash has already warned that he along with his family
would commit suicide if authorities failed to help them.

"We invest more than Rs 2,000 per acre in our fields but
don't get half of that in return," said the letter. "Whatever is
left after the river waters wash away the crop is devoured by
wild boars, as farmers do not have resources to erect strong
protective fences," it added.

Four more farmers committed suicide during the last 24

12
hours taking the toll to 104 in the last 45 days alone. Of the
four, two are from Amravati district and two from Wardha.

SUGGESTED REMEDIES

Once the fact-finding mission comes to some sort of a

conclusion on what is causing the suicides, the next
important step is to prescribe a remedy for this catastrophe.
Dr M. S. Swaminathan, in his report, had made a list of
immediate measures that should be taken for slowing down
the tempo of suicides. The Prime Minister's efforts would be
applauded by all if he takes some action that will put
immediate brakes on the suicides and also provide for the
long term.

One immediate measure that can be taken by the

government is to develop a land market, where the farmers
who find themselves incapable of coping with the situation in
agriculture would have the option of offering their lands for
sale and quitting agriculture. This will also enable those with
the necessary financial, technological and managerial
capacity to face the problems of the WTO epoch and deal
with the biotechnology reality. Also essential is the setting up
of a comprehensive help-line, whereby farmers who feel
desperate can immediately attract the attention of the
authorities so that the latter can step in and curb the
creditors using harsh coercive methods or, alternatively, offer
the suffering family a package tailored to their needs to see
them through the crisis situation.

The Maharashtra State Cotton Monopoly Procurement

Scheme must go, and the Government must declare
categorically that it is ready to purchase the cotton at the
minimum support price, but that there will be no restrictions

13
on the traders entering the market and offering whatever
prices they can to the farmers. The Agriculture Minister tried
this experiment in the wheat market this year, with very
promising results, and there is no reason why the same
experiment should not be tried for cotton.

Dr Manmohan Singh may recall that in the days when he

was the Finance Minister under the then Prime Minister, P. V.
Narasimha Rao, and when he kick-started the globalisation
process, all the measures he initiated were related to
investment, finance and industry; the economic reforms of
the first generation did not touch the farm sector at all.
Agriculture continues to be dominated by a number of
measures that may prove cumbersome to any economic
enterprise.

The Prime Minister will have to be really candid and just in

analysing the situation if he wants to arrive at positive
conclusions that will help save the situation. On the other
hand, if he permits himself to be led by the political
considerations of his party, that would indeed be a great
tragedy for the people of Vidarbha and for agriculture, in
general.

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BIBILOGRAPHY

SITES REFERRED:

1. http://www.blonnet.com
2. http://timesofindia.indiatimes.com
3. http://www.hindu.com

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