Chandigarh, November 11
Farmers owning less than 10 acres will not be able to avail themselves of loans from the Punjab State Cooperative Agriculture Development Bank (PSCADB) to buy tractors or one or two buffaloes for running a dairy. And no small and marginal farmer in that category will be advanced loans by the PSCADB to replace an old tractor with a new one.
Sources said the authorities concerned had issued instructions to officials of the PSCADB posted in the countryside to first examine whether the farmer asking for a loan to buy a tractor had enough land to make proper and adequate use of the vehicle. Secondly, they must determine whether the buying of a tractor will be viable for him or not.
In the past years, farmers in the state owning 5 acres or less had bought tractors by taking loans from the PSCADB. And over the years, they became defaulters and debt-ridden because of the viability factor. Such farmers not only bought tractors but also got costly implements and other equipment by availing themselves of loans.
In a good number of cases farmers misused the loan taken for a tractor. After buying a new tractor, farmers used to sell it after a few days at a reduced price and use the cash for some unproductive purpose such as for buying a motor cycle or building a house.
A few months ago, the Chairman of the Punjab Farmers Commission, Mr G.S. Kalkat, had written to the Reserve Bank of India to instruct all banks to advance loans to buy tractors and implements to only those farmers for whom the buying of farm machinery would be viable. Mr Kalkat had found that farmers having inadequate land holdings had been buying tractors and becoming defaulters of various banks. He had argued that such a step would prevent farmers from becoming debt-ridden.
Mr Vishwajeet Khanna, Registrar, Cooperative Societies, Punjab, said that certain steps had been taken to regulate the advancing of loans for tractors, etc, in the wider interest of farmers. He said that the officers concerned had been asked to first examine all aspects before taking a final decision on advancing a loan to a farmer or anyone else.
He said small and marginal farmers could take tractors and implements on rent from Cooperative Agriculture Services Societies. The PSCADB could advance loans to these societies for buying tractors to provide these to small and marginal farmers by charging a nominal rent on
an hourly basis. He said that such a measure would save thousands of farmers in the state from the burden of debt. For years, there has been a nexus among tractor dealers, bank officials and patwaris in the state. To maximise the sale of their tractors, dealers had been selling these to farmers by helping them get a loan from the PSCADB with the assistance of patwaris and land valuation officials of banks at certain places. However, now the sale of tractors in Punjab has come down as branches of the PSCADB have stopped advancing loans at the behest of dealers and
patwaris.
There were also farmers who had been getting loans to set up dairies. “No dairy is viable without at least 10 milch cattle. With one or two buffaloes a dairy cannot be run. Hence, a decision has been taken to advance loans to only those farmers and others concerned who plan to buy at least 10 buffaloes”, said a senior officer of the PSCADB. In fact, farmers have been availing themselves of loans to buy two or three buffaloes which were never purchased. The loan was used for some other purpose,” said the officer.
There are 53,430 defaulters farmers of the PSCADB.
