{"id":36071,"date":"2018-11-01T13:25:05","date_gmt":"2018-11-01T07:55:05","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=36071"},"modified":"2018-11-01T13:25:05","modified_gmt":"2018-11-01T07:55:05","slug":"think-beyond-loan-waivers","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/think-beyond-loan-waivers\/","title":{"rendered":"Think beyond loan waivers:"},"content":{"rendered":"<p><a href=\"http:\/\/www.thehindu.com\/todays-paper\/tp-opinion\/think-beyond-loan-waivers\/article19311079.ece\"><span style=\"font-weight: 400;\">Think beyond loan waivers<\/span><\/a><span style=\"font-weight: 400;\">:\u00a0\u00a0<\/span><span style=\"font-weight: 400;\">(Farmer\u2019s jeopardy \u2013 need to read between the lines)<\/span><\/p>\n<p><span style=\"font-size: 1rem;\">Context:<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">The farmer\u2019s distress in India needs to be addressed with a firm and concrete solution than farm loan waivers. <\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Demerits of Indian Agriculture:<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">Indian agriculture is characterised by low scale and low productivity.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">More than half of the area under cultivation does not have access to irrigation. <\/span><\/li>\n<li><span style=\"font-weight: 400;\">Agriculture income which is generated at average size of landholding is not adequate to meet farmers\u2019 needs.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Other crucial drawback is weather and market risks. <\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Farm Loan waivers:<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">The ultimate goal of farm loan waiver is to lessen the debt burden of distressed and vulnerable farmers and help them qualify for fresh loans. <\/span><\/li>\n<li><span style=\"font-weight: 400;\">The success of the loan waiver lies on the extent to which the benefits reach the needy farmers. <\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Drawbacks of Farm Loan Waivers:<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\"> First, it covers only a tiny fraction of farmers.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Second, it provides only a partial relief to the indebted farmers as about half of the institutional borrowing of a cultivator is for non-farm purposes. <\/span><\/li>\n<li><span style=\"font-weight: 400;\">Third, in many cases, one household has multiple loans either from different sources or in the name of different family members, which entitles it to multiple loan waiving. <\/span><\/li>\n<li><span style=\"font-weight: 400;\">Fourth, loan waiving excludes agricultural laborers who are even weaker than cultivators in bearing the consequences of economic distress. <\/span><\/li>\n<li><span style=\"font-weight: 400;\">Fifth, it severely erodes the credit culture, with dire long-run consequences to the banking business.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Sixth, the scheme is prone to serious exclusion and inclusion errors<\/span><\/li>\n<li><span style=\"font-weight: 400;\"> Seventhly, the loan waiver as a concept excludes most of the farm households in dire need of relief and includes some who do not deserve such relief on economic grounds.<\/span><\/li>\n<li><span style=\"font-weight: 400;\"> Finally, loan waiving can provide a short-term relief to a limited section of farmers; it has a little chance of bringing farmers out of the vicious cycle of indebtedness. <\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Suggestions:<\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">For providing immediate relief to the needy farmers, a more inclusive alternative approach is to identify the vulnerable farmers\u2019 based on certain criteria; and give an equal amount financial relief to the vulnerable and distressed families.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The sustainable solution to indebtedness and agrarian distress is to raise income from agricultural activities and enhance access to non-farm sources of income.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Improved technology, expansion of irrigation coverage, and crop diversification towards high-value crops are appropriate measures for raising productivity and farmers\u2019 income. <\/span><\/li>\n<li><span style=\"font-weight: 400;\"> States need to undertake and sincerely implement long-pending reforms in the agriculture sector with urgency.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">There\u2019s an urgent need for the removal of old regulations and restrictions on agriculture to enable creation of a liberalised environment for investment, trading and marketing.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Think beyond loan waivers:\u00a0\u00a0(Farmer\u2019s jeopardy \u2013 need to read between the lines) Context: The farmer\u2019s distress in India needs to be addressed with a firm and concrete solution than farm loan waivers. Demerits of Indian Agriculture: Indian agriculture is characterised by low scale and low productivity. More than half of the area under cultivation does&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/think-beyond-loan-waivers\/\">Continue reading <span class=\"screen-reader-text\">Think beyond loan waivers:<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[555],"tags":[],"class_list":["post-36071","post","type-post","status-publish","format-standard","hentry","category-test-1","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704880809},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/36071","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=36071"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/36071\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=36071"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=36071"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=36071"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}