IIPM Mumbai Campus
The Numbers don't add up
In a land of many ironies, here is another one. Orissa's farmers top the list of Kisan Credit Card (KCC) beneficiaries but the agricultural scenario in the state continues to be dismal.
Asked about his farm productivity and income, Gopinath Mallick, a farmer of Aul area in Kendrapara district who owns two acres of land, says: “I cannot buy quality seeds and fertilisers nor can I adopt modern technologies. From my land I earn just about enough to take care of the needs of my family.”
Hasn't Gopinath heard of KCC? “No,” he replies. “Last year, I did try very hard to get a loan from the cooperative society but I failed. They wanted to be bribed. I had no money.” He is among countless Orissa farmers who could do with some organised financial support but do not know where to look for it.
Given the number of KCCs that have been distributed in Orissa, securing an agriculture loan should have been a cakewalk for Gopinath. If it isn't, it is simply because farmers in the coastal belt of the state have no clue that they are entitled to this credit facility. Over the years, the government, both in Bhubaneswar and Delhi, has announced various schemes for farmers. But these programmes have remained on paper even as official records show that everything is on course.
Though Orissa has got the distinction of bringing the largest number of farmers under the cooperative ambit, the reality on the ground tells a different story. A private survey confirms that lakhs of farmers in the state do not know what KCC is. “Even those who have cards are unable to draw the benefits due to lack of awareness,” says R.N. Rath, AGM of Orissa State Cooperative Bank.
Orissa's is primarily an agrarian economy. Farming accounts for nearly 30 per cent of the Net State Domestic Product (NSDP), with 73 per cent of the work force engaged in this sector. Cropped area in the state is about 87.46 lakh hectares out of which 18.79 lakh hectares are irrigated. Therefore, climatic conditions and soil play a vital role in the state’s agricultural productivity. Though there was a breakthrough in agriculture in Punjab, Haryana and western Uttar Pradesh during the mid-1960s owing to the use of new seeds, fertilisers and water technology, the onset of the Green Revolution was delayed by about two decades in the case of Orissa.
The increase in yield rate in Orissa was marginal compared to the agriculturally advanced states. Agriculture has stagnated here over the the last two to three decades. The growth rate has hovered around one per cent during this time span. While the average value of yield was only Rs 5979 per hectare in Orissa it was Rs 15,626 in Kerala, Rs 14,073 in Tamil Nadu, Rs 13,597 in Punjab and Rs 7388 in the rest of India. In Orissa, the compound annual percentage growth rate of yield was only 1.3 whereas the all-India figure was 2.3 in 2009. Moreover, the yield rate of foodgrains in Orissa is only 1080 kg/ha, whereas the all-India figure is 1620 kg/ha.
Says Bimal Pandia, a well-known agricultural activist: “The reasons for low agricultural productivity in Orissa are varied. It is a combined effect of climatological, institutional, technological and infrastructural factors. The often cited reasons are inequality in land ownership and operation, small size of land holdings, land fragmentation, high incidence of concealed tenancy, inadequate irrigation facilities, ineffective extension services, bottlenecks in input supply, warehousing and marketing, frequent occurrence of natural calamities like droughts, floods, cyclones and the like.”
Pandia emphasises the role that constricted agricultural credit has played in slowing down growth in farm output in Orissa. "In recent years, due to fiscal compression public investment in agriculture sector has decelerated. But non-availability of financial support in form of loans to farmers, which they could use to increase productivity from agriculture, is a major reason of low productivity,” he explains.
A progress report of the KCC scheme reveals this failure in the agricultural sector. Orissa also lags behind other states in average loan disbursement. According to Reserve Bank of India sources, while the average loan amount drawn by a KCC holder in Orissa is merely Rs 26,600, the average loan taken per KCC holder in Gujarat stood at Rs 14.6 lakh.
Sanjeev Patro, a senior journalist working in the agricultural sector, says, “The average landholding size in Orissa is around 1.3 hectare against 2.33 hectare in Gujarat. As productivity is directly proportional to the increased input use in the field, higher use of inputs necessitates more loan amount per KCC holder. A recent Nabard study has clearly documented that crop yield per hectare has been higher for farmers holding KCC as they have access to adequate and timely inputs for their crops.”
That brings us back to the fact that Orissa has the highest number of farmers in the country under the KCC scheme. RBI data confirms that over 5 lakh farmers in the state have been registered for KCC, while this figure is around 3 lakh in Gujarat. But the irony is that here credit size far outweighs the benefits.
Rath agrees: “Absence of sealing and small land holdings are a major stumbling block in the way of smooth running of the farm credit system in Orissa. We have more than 2714 credit cooperative societies in the state and of the total of 52,88,00 farmers, 37,80,687 have already availed of credit facility. However, as 90 per cent of these farmers are small and medium land-holders, the credit amount is bound to be relatively low.”
Though the government seems to be happy with the state of affairs and the nodal agencies responsible for disbursement of agricultural loans claim credit for executing pro-farmer programmes with huge success, our farmers are still waiting to be informed about KCC. “The farmers of the state still don't have adequate knowledge about KCC and its use,” he asserts. He should know.
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The Numbers don't add up
In a land of many ironies, here is another one. Orissa's farmers top the list of Kisan Credit Card (KCC) beneficiaries but the agricultural scenario in the state continues to be dismal.
Asked about his farm productivity and income, Gopinath Mallick, a farmer of Aul area in Kendrapara district who owns two acres of land, says: “I cannot buy quality seeds and fertilisers nor can I adopt modern technologies. From my land I earn just about enough to take care of the needs of my family.”
Hasn't Gopinath heard of KCC? “No,” he replies. “Last year, I did try very hard to get a loan from the cooperative society but I failed. They wanted to be bribed. I had no money.” He is among countless Orissa farmers who could do with some organised financial support but do not know where to look for it.
Given the number of KCCs that have been distributed in Orissa, securing an agriculture loan should have been a cakewalk for Gopinath. If it isn't, it is simply because farmers in the coastal belt of the state have no clue that they are entitled to this credit facility. Over the years, the government, both in Bhubaneswar and Delhi, has announced various schemes for farmers. But these programmes have remained on paper even as official records show that everything is on course.
Though Orissa has got the distinction of bringing the largest number of farmers under the cooperative ambit, the reality on the ground tells a different story. A private survey confirms that lakhs of farmers in the state do not know what KCC is. “Even those who have cards are unable to draw the benefits due to lack of awareness,” says R.N. Rath, AGM of Orissa State Cooperative Bank.
Orissa's is primarily an agrarian economy. Farming accounts for nearly 30 per cent of the Net State Domestic Product (NSDP), with 73 per cent of the work force engaged in this sector. Cropped area in the state is about 87.46 lakh hectares out of which 18.79 lakh hectares are irrigated. Therefore, climatic conditions and soil play a vital role in the state’s agricultural productivity. Though there was a breakthrough in agriculture in Punjab, Haryana and western Uttar Pradesh during the mid-1960s owing to the use of new seeds, fertilisers and water technology, the onset of the Green Revolution was delayed by about two decades in the case of Orissa.
The increase in yield rate in Orissa was marginal compared to the agriculturally advanced states. Agriculture has stagnated here over the the last two to three decades. The growth rate has hovered around one per cent during this time span. While the average value of yield was only Rs 5979 per hectare in Orissa it was Rs 15,626 in Kerala, Rs 14,073 in Tamil Nadu, Rs 13,597 in Punjab and Rs 7388 in the rest of India. In Orissa, the compound annual percentage growth rate of yield was only 1.3 whereas the all-India figure was 2.3 in 2009. Moreover, the yield rate of foodgrains in Orissa is only 1080 kg/ha, whereas the all-India figure is 1620 kg/ha.
Says Bimal Pandia, a well-known agricultural activist: “The reasons for low agricultural productivity in Orissa are varied. It is a combined effect of climatological, institutional, technological and infrastructural factors. The often cited reasons are inequality in land ownership and operation, small size of land holdings, land fragmentation, high incidence of concealed tenancy, inadequate irrigation facilities, ineffective extension services, bottlenecks in input supply, warehousing and marketing, frequent occurrence of natural calamities like droughts, floods, cyclones and the like.”
Pandia emphasises the role that constricted agricultural credit has played in slowing down growth in farm output in Orissa. "In recent years, due to fiscal compression public investment in agriculture sector has decelerated. But non-availability of financial support in form of loans to farmers, which they could use to increase productivity from agriculture, is a major reason of low productivity,” he explains.
A progress report of the KCC scheme reveals this failure in the agricultural sector. Orissa also lags behind other states in average loan disbursement. According to Reserve Bank of India sources, while the average loan amount drawn by a KCC holder in Orissa is merely Rs 26,600, the average loan taken per KCC holder in Gujarat stood at Rs 14.6 lakh.
Sanjeev Patro, a senior journalist working in the agricultural sector, says, “The average landholding size in Orissa is around 1.3 hectare against 2.33 hectare in Gujarat. As productivity is directly proportional to the increased input use in the field, higher use of inputs necessitates more loan amount per KCC holder. A recent Nabard study has clearly documented that crop yield per hectare has been higher for farmers holding KCC as they have access to adequate and timely inputs for their crops.”
That brings us back to the fact that Orissa has the highest number of farmers in the country under the KCC scheme. RBI data confirms that over 5 lakh farmers in the state have been registered for KCC, while this figure is around 3 lakh in Gujarat. But the irony is that here credit size far outweighs the benefits.
Rath agrees: “Absence of sealing and small land holdings are a major stumbling block in the way of smooth running of the farm credit system in Orissa. We have more than 2714 credit cooperative societies in the state and of the total of 52,88,00 farmers, 37,80,687 have already availed of credit facility. However, as 90 per cent of these farmers are small and medium land-holders, the credit amount is bound to be relatively low.”
Though the government seems to be happy with the state of affairs and the nodal agencies responsible for disbursement of agricultural loans claim credit for executing pro-farmer programmes with huge success, our farmers are still waiting to be informed about KCC. “The farmers of the state still don't have adequate knowledge about KCC and its use,” he asserts. He should know.
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