Kerala High Court did its part but farmer ends life

Paddy receipt sheet system has become a ledger of loss as farmers in Kerala are the second most debt-ridden in India.

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IN September, Kerala farmers, disgruntled by the complexities and delays in government payments for the paddy they sold, approached the Kerala High Court, and the court ruled in their favour. The government was told to ensure money for the farmers.

Unfortunately, despite the court's intervention, a farmer has reportedly committed suicide by consuming poison on Friday night. He was rushed to a hospital, but was declared dead on Saturday by medics.

K.G. Prasad, the Dalit farmer from Ambedkar Colony in Thakazhi, Kerala, who ended his life due to financial hardship, had called his friend over phone hours before consuming poison to express his despair and regret at being a farmer. He repeatedly complained about the difficulty of obtaining a loan, even after selling his paddy to the government.

While farmers lament their fate and blame climate change, government apathy and a skewed 'paddy receipt sheet' (PRS) system, economists point to the state's bad finances as the root cause.

On September 20, while hearing the petition of the farmers, Kerala High Court Justice Devan Ramachandran observed that the petitioners (farmers) cannot be further prejudiced solely because Supplyco (the government agency) has failed to raise the resources to meet its contractual obligations, nor can they be held responsible for any delays in the grant of loans by the financing bank to Supplyco under the tripartite agreement between the two and the government.

"Shifting any such responsibility onto the shoulders of the farmers is uncharitable and, in any case, wholly impermissible," the justice added.

In Kerala, the state-run procurement agency Supplyco guarantees a minimum support price for paddy and provides farmers with a PRS. Farmers can present this PRS to banks to obtain a loan for the equivalent amount of paddy sold.

Farmers in Kuttanad, the birthplace of M.S. Swaminathan, the father of the Green Revolution in India, are forced to accept the government's PRS system to continue farming, as they plant two paddy crops a year in the June–October and November–March seasons.

Climate change-induced losses, risks of area being below sea-level, rising production costs, and government apathy are all contributing to the financial losses of Kuttanad's paddy farmers.

"When the new generation is reluctant to do farming and moves out of the area, the older ones are left isolated to suffer loss after loss," said Justin, a young farmer in Alappuzha.

My recent visit to Kuttanad confirmed what the young farmer had said.

While decoding the complexities of the PRS system, the young farmer said that he too has got a PRS and has taken a loan from the bank.

"I sold my paddy to Supplyco. Instead of paying me, they give me a PRS. I go to the bank and get money, which is considered as a loan taken by me. The government will repay the loan and interests.

"But, sometimes, the government fails and the pay dates are missed. Eventually, my CIBIL score gets affected. It is lowered. When I approach for a different loan, my application will be rejected," Justin added.

Justin shared the screenshots of three late payments made by Supplyco in his agriculture loan taken by producing his PRS.

Prasad, the deceased farmer, had also been complaining about his PRS and CIBIL score in the last phone call he had made to his friend before consuming poison.

CIBIL, which stands for Credit Information Bureau (India) Limited (CIBIL), is a three-digit numerical representation of an individual's creditworthiness. It is derived from the credit history and repayment records available in the credit information report. CIBIL scores in India typically range from 300 to 900, with a higher score indicating better creditworthiness.

Lenders, such as banks and financial institutions, use the CIBIL score as one of the factors to assess a borrower's credit risk before approving a loan or credit card application. A higher CIBIL score increases the likelihood of getting approved for credit and may also result in more favourable loan terms, such as lower interest rates.

However, Kerala's Food and Civil Supplies Minister G.R. Anil clarified that farmers do not bear the burden of PRS loans.

"The arrears of PRS loans have been fully paid. Therefore, PRS loans will not affect the CIBIL score of farmers," the minister said. Supplyco comes under his ministry.

Meanwhile, B.A. Prakash, a leading economist who has authored 50 books in the last 50 years, said that the state is in a severe financial crisis.

"The state is already facing a revenue deficit of ₹25,000 crore over the last six months. The financial crisis has started to hit the common man," he said, adding that it is hard for those who are eligible to get their money due to them from the government.

Data placed before the Parliament on February 7, 2023 reveals thatwhile 22 farmers ended their life in Kerala in 2019, 57 committed suicide in 2020 and 34 in 2021. This means that, on average, every month two farmers are committing suicide in Kerala.

The same data reveal that, in India, the number of farmers who committed suicide were 5,957 in 2019, 5,579 in 2020 and 5,318 in 2021. This means that, on average, 15 farmers end their life in India daily.

Meanwhile, data placed before the Parliament on February 13, 2023 reveals that, in terms of outstanding loans in a farmer's household, Andhra Pradesh occupies the first position and Kerala is in the second position.

If a farmer in Andhra Pradesh has a loan of ₹2.45 lakh, a Keralite farmer has a loan of ₹2.43 lakh.