INEVITABLE TRAGEDY

INEVITABLE TRAGEDY

Newspaper reports show that from January 1, 2004 to May 16, 2004, about 29 farmers in Andhra Pradesh (AP) committed suicide. From May 17, the suicides suddenly increased: the AP Rytu Sangham, the farmers' wing of the Communist Party of India (Marxist), has compiled reports of 279 suicides by farmers in the state in one month.

The results of the state legislative assembly election were announced on May 13. People first thought the suicides had suddenly increased as a result of the relief package for farmers the Congress-led coalition -- which defeated the Telugu Desam Party-Bharatiya Janata Party (TDP-BJP) combine -- announced. But more complex reasons soon began to emerge. The media, preoccupied by the general elections it had failed to read, also failed to understand the farmers.

For March and May are the months when farmers settle old loans and get new ones for the kharif crop. This is also the time when moneylenders start recovering their money. With repeated crop failures and high costs of cultivation, the farmers had no money to repay debts. Rains were setting in, offering hope to those who could buy new seeds and other inputs, and misery to those who couldn't. The elections also played a role -- moneylenders were quiet (informal farm loans --the bulk of farmers in AP rely on it-- and election contributions tend to come from the same financial quarters).

Sudarshan Reddy, a professor of economics at Warangal's Kakatiya University who has studied the problems that led to farmers' suicides in 1997-1998, says cooperative banks had stopped recovering loans during elections. Immediately after, pressure began to pile up. Heavily indebted farmers, the system itself, cracked up.

Loan recovery apart, moneylenders also had to make up for the contributions they had made to politicians' kitties. A rich businessman says: "It was obvious the Congress government was not going to be as friendly to the traders/moneylenders as the TDP. There was talk of a moratorium on debt recovery; they were in a hurry to get back loans. Relief for farmers was one of the main issues that the Congress campaigned for."

This may explain the present crisis, but the question is: was it really that sudden? AP had witnessed a spate of farmers' suicides in 1997-98. The immediate reasons were the same then as now (see 'Abetment to suicide', Down To Earth, February 28, 1998). But suicides then were limited to northern districts like Warangal, where pest attacks destroyed cotton crops. This year, there have been suicides in all the districts. Farmers growing all the major crops in the state are killing themselves, including paddy-growers in Coastal Andhra.

Reports compiled by the Human Rights Front from Telugu newspapers show that suicides have occurred regularly in the state since 1997-1998. "There are no official figures on farmers' suicides as the previous government didn't recognise them. Naidu didn't want to help the farmers," says Kodandram Reddy, professor of political science at Hyderabad's Nizam College, who is with the Human Rights Front and has travelled throughout the state to find why farmers commit suicides. The TDP government in fact believed that providing relief to the families of farmers who had killed themselves would be an incentive for others to commit suicide. District collectors knew very well they were not supposed to recognise a farmer's suicide. That the TDP government didn't provide relief is one thing. That most of its policies and programmes actively hurt the farmer is quite another.

The media -- this magazine included -- has largely failed to report the scale of this tragedy in the past six years. Farmers' debts accumulated as the cost of farm inputs -- water, land, seeds, pesticides and fertilisers, in that order -- increased dramatically since the 1980s, while prices of agricultural produce stagnated or fell in the past decade. To finance inputs, the farmer came to rely primarily on private moneylenders who charge interest rates ranging from 24 per cent to 60-75 per cent. The formal agriculture credit system meets only an estimated 20-30 per cent of the total credit requirements of the state's farmers; farmers obviously struggled to cope.

Can't afford inputs
On December 2, 2001, Jayalaxmi took a sari and hung herself in her house. She was 12. The repeated reminders from her school that she hadn't paid her fees embarrassed her terribly. Jayalaxmi's father, P Laxminarayan, says she had read an anxious letter from his married sister, in which she voiced her fears, writing her in-laws might kill her if they weren't given jewellery as dowry: "Jayalaxmi probably wondered how I will pay for her education and dowry if I was struggling to save my sister," says the farmer of Mamillakuntla village in Obuladevara Chervu mandal, Anantapur district.

Laxminarayan was a mason working on daily wages in Hyderabad when Jayalaxmi killed herself. He had borrowed Rs 40,000 from three farmers at an interest of 2 per cent per month, and Rs 45,000 from a bank, to repair his house and set up a grocery shop at home. Till the day Jayalaxmi died, creditors used to visit and ask Laxminarayan to return their loans. His two hectares (ha) of unirrigated land doesn't yield anything. "It has hardly rained in four years, and my groundnut crop has failed year after year," he says.

CAUGHT IN A BOREWELL TRAP: Anantapur, AP's largest district, falls in a rain-shadow zone of the Rayalseema region. The dryland agriculture here depends on an annual average rainfall of 553 mm (the lowest in the state, which gets an average annual rainfall of 940 mm). Rayalseema has the fewest irrigation tanks in the three regions of the state, and relies most on groundwater. Mamillakuntla village's drinking water comes from a 150-metre-deep borewell.

"I dug four borewells in five years for Rs 50,000-Rs 80,000 each. Three have gone dry; the last one plumbs 140 metre and gives little water," says G Venkatramanna, a farmer with eight ha. His owes more than Rs 1,50,000 in debts, half from private moneylenders. Three years ago, he sold his flock of 200 sheep for about Rs 1,00,000 to dig a borewell and recover losses. It went dry. Why did he sell livestock, which is good at surviving drought and helps farmers in bad years? "Land price is low. Everybody's in debt and there are no buyers for land," he says.

Y Ramakrishna Reddy has about five ha, three dry borewells, and a Rs 1,30,000 debt -- Rs 60,000 to private moneylenders. "When N T Rama Rao was the chief minister, we paid an annual electricity charge of Rs 26 for a bore. I voted TDP in 1999. But they raised the power tariff to Rs 250 per month, with a deposit of Rs 14,000. This time I voted Congress," says the 65-year-old.

Surya Narayan Reddy has 2.5 ha and a debt of more than Rs 2,50,000, half of which he took from private moneylenders for his daughter's wedding in February this year. He borrowed Rs 12,000 in his wife's name to start a small business, but spent it on a borewell, which is dry, along with two others in his field. Creditors are harassing him, and Surya Narayan says he is on the brink. He called the farmers' helpline the Congress government opened on May 22 in all district headquarters, but only got assurances. At the Anantapur district headquarters, employees of the agriculture and revenue departments take turns at handling distress calls. They logged 1,072 calls in 17 days. Syed Mehboob Basha, an agriculture department employee and a member of the Human Rights Front, has recorded 336 cases of farmers' suicides in Anantapur district since August 1, 2000.

SEEDY SNARE: But farmers' desperation also has to do with seeds, too expensive despite a government subsidy and too inadequately regulated. In Bomlatapalli village of Bokkaraya Samudram mandal of Anantapur, Nagalaxmi explains the lure of groundnut, a rainfed crop and a major reason for rising expenses: "My husband hung himself from the tree behind our house 11 years ago when he couldn't repay the Rs 80,000 he had borrowed. Five years ago, we had a good groundnut crop, and my son settled the old loans."

But then the family borrowed Rs 50,000 for their daughter's wedding. They also took loans for groundnut seeds, fertilisers, bullocks and a buffalo. The bullocks died and they had to borrow again to buy a new pair. By May 5, 2004, the debts piled up to Rs 1,30,000, all of it from private moneylenders, and the new pair of bullocks had been sold. That day, Nagalaxmi's 25-year-old son hung himself, not far from the tree where his father had died. AP's agriculture minister personally gave Nagalaxmi a cheque of Rs 1,00,000 to start farming afresh. She wants to spend the money on her younger daughter's wedding. She hasn't sown the seed in this season. Siva, her younger son, is 12, and too young to handle bullocks.

Rayalseema went in a big way for groundnut in 1980; the Union government had subsidised seeds to cut down on edible oil imports. But restrictions on importing palm oil were removed in the 1990s, and groundnut prices crashed. Palm oil sells for Rs 16 per litre, groundnut oil Rs 52 per litre.

But right now the greatest woe is procuring seed. Angry farmers last month beat up agriculture officials in the Rayalseema region because of poor groundnut seed supply. For this year's kharif crop, the state government will distribute 563,000 quintals of groundnut seeds, most to go to Anantapur district. But each farmer will get a maximum of 120 kg of seed, while a hectare of land requires more than 140 kg. The government only subsidises 38 per cent of the cost, which means farmers pay Rs 16 per kg. Seeds are only given against passbooks issued to those who own the land. So tenant farmers, and those who want to grow groundnut on more than one hectare, have to buy from the market at more than Rs 24 per kg. "I can't even afford the subsidised seed, so I will buy it from large farmers and traders on credit. That would be about Rs 7,000, with interest," says Laxminarayan of Mamillakuntla. But tenant farmers can't avail of the government seed subsidies (see box: Like a vice). Except groundnut, soybean and maize, government doesn't subsidise seeds for other crops. Cotton and chilli farmers in AP's Telengana and Coastal regions are therefore entirely at the mercy of the seed sector.

ENTER PRIVATE SUPPLY: Cotton cultivation picked up in Telengana when cotton farmers of Coastal Andhra, particularly Guntur, migrated to districts like Warangal and Karimnagar. "It is these farmers that control the trade of inputs like pesticides and seeds," says Sudarshan Reddy. In fact, in Warangal town, it is difficult to get a hotel room in the sowing season -- seed companies occupy all rooms and organise a marketing and sales blitzkrieg.

State newspapers, too, are full of seed advertisements. Telugu TV channels such as Eenadu and Teja have farmers' programmes that provide free advice on seeds, pesticides and fertilisers. The front page of AnnaData, a farmers' magazine with about 200,000 subscribers, often advertises companies making pumps and motors for borewells. Does this influence farmers in Karimnagar district, which had the highest number of farmers' suicides this year? M Mahendra Reddy, a resident of Karimnagar's Kondapur village, who killed himself on May 24, was a regular reader of farmers' magazines. "He was heavily influenced in his farming practices by ads on television and in magazines and newspapers," says his father-in-law. What about advice from the government's extension staff? "They are a rare sight. The extension staff of private companies is far more regular and frequent in our region," he says.

FOR PESTICIDES, TOO: He should know. He was one of the hundreds of farmers who took to the street a year ago, demanding government provide DuPont's pesticide Avaunt through the extension system. Its cost, per litre, is Rs 10,000, though it is used in small quantities. A former extension official says pesticide companies get licences to import a small amount of a new chemical for marketing trials. This chemical is then advertised and sold in shops in excess of the quota, violating all norms. That the government fails as a regulator to protect the farmer is an open secret. If you ask Warangal farmers whether government hauls up violators, they will relate the case of Tirupati Reddy of Saral Seeds who was arrested in June 2003, ostensibly for manufacturing spurious chilli seeds. On closer enquiry, all that transpired was that he didn't have a licence to package seeds in Warangal but only in Hyderabad. Reddy was released after a minor fine, and officials as well as seed traders say the real matter was a business rivalry.

The only regulatory system that seems to work in the seed and pesticide sector is through dealers and shopkeepers. "If the seed fails to germinate, the farmer usually goes to the dealer who sold it," says Tatikonda Kedari, proprietor of Vasavi Fertilisers Depot, Warangal, and an influential trader. "When they come to me, I arrange a meeting between the seed company and the farmer. The matter is usually settled by giving the farmer compensation. But if the problem is noticed at the stage of flowering, then it is very difficult for the farmers to get any kind of compensation. The only other option for the farmer is to approach the consumer court," says Kedari. There are 90 seed companies with 140 varieties of cotton in Warangal, and Kedari stocks 40 varieties. Farmers line up outside his shop to buy the latest hybrid seeds. Their eyes gleam with the hope of a good harvest this season.

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Out on their own

There are several delivery systems whereby government can help farmers in AP. Some, like the agriculture extension system, institutional lending bodies and irrigation,, have a direct role to play in agriculture. Others, like the Panchayati Raj institutions, should've provided the template for success. None are currently of any good.

Take agriculture extension, for instance -- the government's way to interact with farmers. The TDP government came to power in 1994, but didn't recruit agriculture extension officers till it got into election mode. Of the present field staff of 10,687, as many as 2,579 were hired in 2002 and another 5,297 last year. About 75 per cent of the field staff was hired in the past two years as multi-purpose extension officers (MPEO) on an annual contract of Rs 5,000.

What were the criteria for these recruitments? Candidates had to hold a BSc degree, 'preferably' in agriculture. As a consequence, all kinds of unemployed young people joined the extension machinery, which communicates the latest scientific learning in agriculture to farmers in a digestible manner. It is the field staff that apprises the agriculture officials of what farmers need, mediating between the farmers and the policy makers. The tech-savvy TDP government even hired graduates in computer sciences, zoology, and what have you. The new recruits did not possess either the technical education or the communications skills to do their job. And they got almost no training or guidelines. MPEOs are the implementing arm of the Rythu-Mitra Groups, started last year to bring to agriculture the self-help group system of collective action. It doesn't require investigative journalism to figure out that the groups either don't exist in villages, or that most villagers are unaware about them.

SOWING LOSSES: Perhaps the biggest worry for agriculture in AP is the rising cost of production, which makes the state uncompetitive and reduces farm income. " AP has a surplus in paddy, cotton and groundnut. But in all the three crops, AP can't compete with the other states in terms of cost of cultivation," says S Subrahmanyam of the Centre for Economic and Social Studies (CESS), Hyderabad (see table: Farming is expensive in AP). "Profit margins are down to Rs 2,000 per acre per year in irrigated areas. As 80 per cent of farmers are marginal (with less than five acres of land), the annual average income for a household from agriculture is Rs 10,000. Imagine running a household with that," he says.

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Village Punukula's different

A women's self-help group in Punukula village approached a bank for a Rs 25,000 loan to buy an electric neem powdering unit last year, and was turned down. The group's credit history was good, say residents of this predominantly tribal village of 204 farming households in Palvoncha mandal of Khamman district. But they are confident they'll bag the loan this year. For they have reduced their cost of cultivation, maintained yield, made farming profitable, and are shrugging off the debt burden.

For about two years now, the village has avoided using chemical pesticides, the most expensive input into its cotton crop. They follow non-pesticidal management (NPM) of pests, with the help of SECURE (Socio-Economic & Cultural Upliftment in Rural Environment), an NGO based at the nearby town of Gattaigudem. On its part, SECURE obtained technological help from the Centre for Sustainable Agriculture (CSA) in Hyderabad. For pest control, the village uses hormone traps and trap crops, sprays of chilli-garlic, neem seeds and cow dung-urine.

SEEDS OF CHANGE: The village's link with SECURE began in 1999, via a successful watershed development programme. Soon after, SECURE encouraged villagers to use NPM methods. Could pests be controlled without pesticides? "They were talking about spraying neem," says Hemla Naik, secretary of the village's watershed committee. "I brushed my teeth with neem twigs every day and it didn't seem harmful. How was it going to kill the insects that couldn't be controlled with repeated sprays of pesticides the agriculture department staff recommends?"

Pesticides were avoidable, costing too much and forcing villagers to buy on credit from suppliers and shopkeepers. The latter would then buy produce at rates lower than the market, as 'adjustment' for loans. "They once took away my cotton when I wasn't home. They'd offer Rs 1,800 per quintal when the market price was Rs 2,800 per quintal," says Naik. With the cost of production exceeding the yield price, farmers would take loans from banks and private moneylenders each year, increasing the quantity of chemical pesticides for a better crop. Dhanamma recalls mixing acephate powder with alpha-methrine, among other things, under advice from pesticide dealers. There were also health effects. Man Singh, 35, remembers acute toxicity: poor eyesight, loss of coordination, and a hospital bill of Rs 14,000. Women mixing pesticides reported skin irritation. Naik's son fell seriously ill after spraying pesticides in 2000 and was hospitalised for 10 days -- the hospital bill added to his debts, crossimg Rs 1,00,000 in 2001.

FARMER TO FARMER: Around this time, SECURE organised a trip for some villagers to visit a village in Nalgonda district where another NGO was helping implement NPM. This clicked with Margam Mutthaiah, 60, an influential village elder with 1.2 ha of land, and the first to opt for NPM in 2001. "I had nothing to lose. I owed Rs 1,20,000. One season, I spent Rs 18,000 on chlorpyrophos, monocrotophos, endosulfan and other pesticides." His crop yield in 2001 was no different from those who used pesticides. Dhanamma and Naik were among the first to follow Mutthaiah. In the past two years, Naik's cost of cultivation has fallen down from about Rs 60,000 per hectare to Rs 10,000.

Profitability has brought back interest in land. Villagers say they'd like their children to be farmers. Mutthaiah, whose debt -- to a cooperative bank -- is now down to Rs 31,000, says there isn't any fallow land in the village anymore. The biggest coup came when N Venkateshwar Rao, a farmer of neighbouring Pullyagudem village with about 30 ha of land, didn't use any pesticides in the last season. The sweet irony is that he owns Anant Laxmi Fertilisers, a shop selling pesticides on credit. He said he stopped using the chemical pesticides because of a chain reaction in surrounding villages. This way, he saved Rs 6,00,000.

"They saw other farmers practice NPM. That meant more than all our talk," says Venumadhav. Says Ramanjaneyulu, executive director of CSA, "India seems to have forgotten that the Green Revolution succeeded due to rigorous extension work and farmer-to-farmer contact." Having invested in Punukula, he now gets its residents to go and meet farmers elsewhere.

But isn't NPM very labour-intensive? It is, but the Punukula experiment clearly shows it makes better sense for the small and marginal farmer who has the labour but not the capital investment. Most of the additional labour of NPM -- collecting and grinding neem seeds, making pastes and solutions -- falls to the lot of the women. They really want an electric powdering unit.

These farmers can compete in most markets due to the low cost of cultivation," says Ramanjaneyulu. But Punukula is no model. "Each village requires a different solution," he says. "Hopefully, we will get to a stage where insects are not pests and their natural predators are aplenty. It is important to get out of this war of attrition with insects -- they will always be a step ahead. We have to start looking beyond neem, for, who knows, the insects might acquire resistance to neem too."

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Mourn

AP's plight brings into sharp focus India's agrarian crisis. The sorry state of institutional credit, consigned to the dustbin, is back on the agenda. The Union government has promised to double institutional credit available to the farm sector. In AP, institutional credit accounts for a mere 20-25 per cent of the farm credit requirements. How will this proportion change?

Crucially, the proportion of small loans (below Rs 25,000, mostly to small and marginal farmers) has been falling since the 1990s. Will the banks' service to these sections improve, or will now-increased credit flow to rich farmers, as is usual? Will banks invest in the small farmer, given the burden of non-performing assets? Banks can't provide loans to tenant farmers at all right now, and they have been requesting governments to conduct a land survey and devise instruments to formally recognise tenant farmers and share-croppers. This has to be taken up as a priority. Contract farming has been often proposed as an option. But that is a business scenario, and for it to be on level terms, the farmer must have more bargaining power at his disposal.

A lot has been said of the self-help groups (SHGs) of Andhra Pradesh. Did they fail the distressed farmers? It seems the scale of credit they offer can't provide for the rising costs of agri-inputs. The real challenge is in making agriculture a reasonable livelihood proposition. Till this happens, all talk of increased credit and moratoria on debt recovery is pointless. Right now, the farmer needs financial support. But to ensure this crisis doesn't continue, one area that needs immediate attention is the cost of cultivation. The 'more yield' mentality must go. If the farmer's income increases, so will the costs. That is the rule of the market economy.

The sectors that need the most urgent attention right now are irrigation and agricultural extension services. The AP government has already announced free power to farmers and a waiver on dues of Rs 1,200 crore: timely, but a short term solution. The Congress government plans to spend Rs 36,000 crore on irrigation projects. A loan of Rs 2,000 crore has been announced. Let all irrigation projects be implemented. Even then, half the arable land would still be beyond their command. Has government thought about this?

One of the pre-election promises of the Congress was to make Panchayati Raj more effective and real. Panchayats should be involved in some serious planning to improve the management of irrigation tanks and developing watersheds. For this, they require real power (read: money). The need for local governance is important because water has to be owned and managed as a collective resource -- not like the free-for-all digging of borewells, as is the case now, in which whoever has more money can dig deeper and suck the aquifers dry. And collectivism works only in decentralised systems, not through government orders.

But none of this would mean a thing if the quality and accessibility of agriculture extension is not improved. If the government doesn't hear what the farmer says and doesn't know how to communicate and influence the farmer. "It isn't just the physical presence of extension staff. The government's understanding of extension has to change. "We dwell too much on the failures of the Green Revolution, and seem to have forgotten why it achieved the success that it achieved," says Ramanjaneyulu. "Strong extension and advice to the farmer, farmer-to-farmer exchange of seed, and a research system willing to back the farmer."

The (non)system of crop insurance needs a serious overhaul. In its present form, it provides the farmer nothing. Right now, the crop of the entire mandal has to fail for the insurance application to move. And even if it is approved, the crop insurance money seldom arrives before two years and is never a true compensation.

In all, it is a tough task. But if ever people gave a clear mandate, it was to the Congress in AP this time. It is now the task of the new government to revive agriculture. Is this not a challenge worth taking?

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A debt-ridden state can offer little to its indebted farmers

"The strategy for agriculture will certainly create new jobs, especially in the allied sector. However, agriculture's share of employment will actually reduce, from the current 70 per cent to 40-45 per cent.... As economies grow, the focus of economic activity shifts from primary activities to those that lead to greater value-addition. As Andhra Pradesh's economy develops, it will follow the same pattern, shifting from a predominantly agrarian to an industry- and services-led economy. As a result, more and more jobs will be created in industry and services as compared to agriculture."

-- former Andhra Pradesh chief minister
N Chandrababu Naidu's Vision 2020, released October 2001

The infrastructure that supports agriculture collapsed right through the 1990s
• Agriculture and allied sectors account for a third of Andhra Pradesh's (AP's) GDP. They provide livelihood to over 70 per cent of its population. But in 2003-04, total expenditure on agriculture and allied services was 2.52 per cent of the total expenditure on economic services. In other words, while agriculture's significance to AP's economy and society is immeasurable, the attention the state has been paying to it is negligible

• The state's self-generated revenue in 2003-04 was Rs 18,169 crore, while its total expenditure was Rs 42,081 crore. Of this, Rs 24,000 crore was spent on salaries and pensions, debt repayments and interest payments alone, leaving only Rs 18,088 crore to spend on building those capacities -- irrigation, road, transport, energy -- that helps an economy to grow

• When Chandrababu Naidu became chief minister of the state in 1995, AP's total accumulated debt was Rs 15,137 crore. Since then, it has soared: in the fiscal year 2003-2004 the state's total accumulated debt stood at Rs 57,160 crore. As of now, the state's primary energies seem geared to debt-servicing: in 2003-2004, interest payment on the debt was Rs 6,880 crore, almost one-sixth of all that it spent. In addition, Rs 5,829 crore was spent on debt repayment (this component was Rs 13,233 crore in 2001-02). Salaries and pensions cost the state Rs 11,285 crore in 2003-04. All these amounts are a staggering contrast to the Rs 1,024 crore that the state spent on the agriculture and allied sectors, and the Rs 3,834 crore that it spent on irrigation and flood control.