TDP poll promise: Farm Loan and Women SHG loan Waiver is impractical

Telugu Desam Party has been promising loan waiver to farmers and DWRCA women self help groups immediately after coming to power.  On 24th March, TDP leader has released the Manifesto for 2014 local body elections and promised to waive the loans of Farmers and SHG women.   These promises Rs. 90,146.87 crore (Rs. 67,224.28 cr of farm loans and Rs. 22,922.59 cr of Credit to Women Self Help Groups) will cost about 50% of the total budget (Rs. 1,83,129.00 crores) proposed for the year 2014-15.  While indebtedness among farmers itself is high, institutional credit to agriculture is only around 21%.  Most of the institutional credit only goes to land owners and not the real cultivators who take land on lease and cultivate. In this regard we feel that spending half of the budget to raise hopes and votes from many and finally helping only few is completely unjustified.

The TDP leader is also asking farmers and women self-help groups not to repay the loans as he would waive all of them when comes to power. This will also affect the credibility of the farmers and women SHGs and effect their Credit worthiness.

A.      On Farmers Loan Waiver

  1. The total loans to farmers planned during 2013-14 were Rs. 67,224.28 crore against which Rs. 38,491.65 crores were disbursed till 30th September, 2013. Rest would be distributed in the next during the rabi season (October, 2013 to March, 2014).

Agriculture Credit during 2013-14 (Rs. In Crores)

  Target 2013-14 Achieved till 30th sept 2013
Crop loans 49,988.69 28,820.19
Term loans 7217.50 6276.79
Agril allied loans 10018.08 3394.67
Total 67,224.28 38,491.65

Source: State Level Bankers Committee, http://www.slbcap.nic.in

If this target has to be met, the total budget requirement would be around

The loans are also not evenly or equitably distributed. Based on the data available the variations as follows. The region which is going to be formed as Andhra Pradesh (13 districts) had 61% of cultivated area while the total agriculture credit given till 30th September, 2013 is 69% whereas the state of Telangana which has 39% area got only 31% of the agricultural credit.

Regional Variation in Agriculture Credit (2013-14)

Region/New State 

Total Cropped area

Total Agriculture Credit

in ha

% to total

Target

% to total

Achieved*

% to total

Andhra Pradesh

7662000

61%

47016.95

70%

26486.21

69%

Telangana

4899001

39%

20207.33

30%

12005.44

31%

Total

12561001

100%

67224.28

100%

38491.65

100%

* till 30th September, 2013

Variations are also seen between districts within the two going to be formed states. For example in the 13 districts which are going to be formed as Andhra Pradesh the distribution is as follows. The four districts of Krishna, Guntur, East and West Godavari districts which have only 36% of the cultivated area got about 50% of agriculture credit.  Some people will get undue advantage compared to others.  The details of others districts is given in the annexure.

Regional variation within the newly forming state of Andhra Pradesh (2013-14)

Districts % cultivated area % agril credit target % agril credit achieved
Utterandhra: Srikakulam+Vijayanagaram+Vishaka patnam

14%

11%

9%

Coastal: Krishna+ E& W. Godavari+Guntur

36%

50%

49%

Coastal: Prakasham+ Nellore

14%

14%

11%

Rayalaseema: Chittor+Kadapa+Ananthpur+Kurnool

36%

26%

31%

 

The data of 2012-13 (annexure A) also showed the same trend.

  1. The access to institutional credit is as low as 21% in the combined state of Andhra Pradesh. The government estimation is that the state has 40 lakh tenant farmers and they do not have access to institutional credit. AP government has enacted Loan Eligibility Card scheme Act which identifies Tenant Farmers and issues Identity card which can be used to get access to credit. During 2013-14 only 4.43 lakh cards were issued and among them only 20% of them got access to crop loans. Rest of the farmers had to depend on the private loans at higher rates.
  2. Before going for 2009 elections the UPA government throughAgricultural Debt Waiver and Debt Relief Scheme (ADWDRS), 2008 has waived about Rs. 52,000 crores across the country.  In AP, the total number of farmers who benefited from the scheme was 77,55,227 and the total loan waiver and relief given to them was Rs 11,353.75 crore.  CAG found that in AP, a sum of Rs 40.76 lakh went to ineligible beneficiaries (132 accounts) and reimbursement was made for an amount of Rs 26.55 lakh though loans had not been disbursed (96 accounts).

B. Loans to DWRCA/Women Self Help Groups

  1. Total loans to Women SHGs in Andhra Pradesh are Rs. 22,922.59 crore.
Loans to Women SHGs In crore (as on 30th September, 2013)
Total out standing Rs. 21,245.19
Over dues Rs. 946.15
Non Performing Assets (NPAs) Rs.731.25
Total Rs. 22,922.59

http://www.slbcap.nic.in

The TDP leader also promised the waiver of loans to women self help groups and is asking them not to pay the loans in every meeting.

TDP should make clear

a. Whose loans and what loans will waived.   Otherwise many farmers are now not paying their dues and at the end they all end up in problems.

b. what would be the quantum of loans that would be waived and what is the source of the resources.

Annexure A

The Agriculture Credit Target and Disbursed during 2012-13

Districts Net cropped area % to total Target Disbursed % of achivement % to total

1

Srikakulam

405000

3%

1003.27

1297.49

129.33%

3%

2

Vijayanagaram

373000

3%

650.85

976.44

150.03%

2%

3

Vishakapatnam

315000

3%

666.71

1257.18

188.56%

3%

4

East godavari

598000

5%

2862.44

5089.93

177.82%

10%

5

West godavari

618000

5%

3074.45

5157.56

167.76%

10%

6

Krishna

716000

6%

2178.14

2975.34

136.60%

6%

7

Guntur

796000

6%

3660.46

4597.55

125.60%

9%

8

Prakasham

628000

5%

2039.86

2940.49

144.15%

6%

9

Nellore

429000

3%

1418.68

2316.99

163.32%

5%

10

Chittor

404000

3%

1767.24

2360.35

133.56%

5%

11

Kadapa

473000

4%

1656.70

2056.82

124.15%

4%

12

Anantapur

901000

7%

2476.06

2704.79

109.24%

5%

13

Kurnool

1006000

8%

2049.00

2361.68

115.26%

5%

14

Mahaboobnagar

917000

8%

1980.00

1061.92

53.63%

2%

15

Medak

554000

4%

945.00

1474.03

155.98%

3%

16

Nizamabad

420000

3%

1668.00

1255.41

75.26%

3%

17

Adilabad

634000

5%

920.00

2046.19

222.41%

4%

18

Karimnagar

563000

4%

1688.00

2046.19

121.22%

4%

19

Warangal

557000

4%

1345.00

1436.43

106.80%

3%

20

Khammam

439000

3%

1055.77

1514.07

143.41%

3%

21

Nalgonda

585000

5%

1351.38

1684.31

124.64%

3%

22

Ranga reddy

230000

2%

669.47

1059.62

158.28%

2%

23

Hyderabad

100%

0%

1.30

434.42

33416.77%

1%

Total

12561001

101%

37127.78

50105.2

134.95%

 

Total Agriculture credit to Farmers during 2013-14

Name of the District 

Total Cropped area

Crop Loans (Rs. In Crore)

Agrl.Term Loans (Rs. In Crore)

Agrl.Allied (Rs. In Crore)

 

Total Agriculture loans (Rs. In Crore)

 

in ha

%

Target

achieved

% to total

Target

Achieved

% to total

Target

Achieved

% to total

Target

% to total

achieved

% to total

Andhra Pradesh

1

Srikakulam

405000.00

5%

1435.80

819.44

4%

495.74

129.21

4%

132.42

60.09

3%

2063.96

4%

1008.74

4%

2

Vizianagaram

373000.00

5%

1000.00

370.00

2%

180.00

60.05

2%

350.00

141.45

6%

1530.00

3%

571.50

2%

3

Visakhapatnam

315000.00

4%

800.10

699.33

3%

452.50

128.03

3%

160.29

70.58

3%

1412.89

3%

897.94

3%

4

East Godavari

598000.00

8%

4765.73

2356.78

11%

463.81

510.64

14%

1224.98

234.70

10%

6454.53

14%

3102.12

12%

5

West Godavari

618000.00

8%

4374.08

3025.54

15%

411.90

353.71

10%

1452.05

157.67

7%

6238.04

13%

3536.92

13%

6

Krishna

716000.00

9%

3049.39

2026.06

10%

453.80

260.75

7%

728.65

304.13

13%

4231.84

9%

2590.94

10%

7

Guntur

796000.00

10%

5191.61

2649.77

13%

210.71

579.90

16%

980.70

443.06

20%

6383.01

14%

3672.73

14%

8

Prakasam

628000.00

8%

2600.32

1241.90

6%

747.38

319.68

9%

66.42

23.91

1%

3414.13

7%

1585.49

6%

9

Nellore

429000.00

6%

2402.84

893.45

4%

142.01

262.35

7%

460.38

144.63

6%

3005.22

6%

1300.43

5%

10

Chittoor

404000.00

5%

2044.87

1597.00

8%

109.99

168.29

5%

577.60

395.22

17%

2732.46

6%

2160.51

8%

11

Kadapa

473000.00

6%

2004.60

1260.11

6%

253.90

605.92

16%

563.20

47.03

2%

2821.70

6%

1913.06

7%

12

Ananthapur

901000.00

12%

3127.31

2085.56

10%

290.49

84.19

2%

123.38

144.08

6%

3541.17

8%

2313.83

9%

13

Kurnool

1006000.00

13%

2752.00

1505.00

7%

189.00

228.45

6%

247.00

98.55

4%

3188.00

7%

1832.00

7%

 

Total

7662000.00

100%

35548.65

20529.94

 

4401.23

3691.17

 

7067.07

2265.1

 

47016.95

 

26486.21

 
Telangana

1

Mahabubnagar

917000.00

19%

2405.70

1120.16

14%

452.01

298.07

12%

137.00

104.13

9%

2994.71

15%

1522.36

13%

2

Medak

554000.00

11%

1134.00

740.19

9%

198.00

203.85

8%

126.00

91.21

8%

1458.00

7%

1035.25

9%

3

Nizamabad

420000.00

9%

1921.00

950.25

11%

482.00

210.08

8%

708.00

89.86

8%

3111.00

15%

1250.19

10%

4

Adilabad

634000.00

13%

1656.50

704.05

8%

114.33

30.00

1%

19.79

24.82

2%

1790.62

9%

758.87

6%

5

Karimnagar

563000.00

11%

1772.40

1033.33

12%

473.26

411.31

16%

267.91

177.95

16%

2513.57

12%

1622.59

14%

6

Warangal

557000.00

11%

1800.00

985.31

12%

210.00

71.15

3%

280.00

74.13

7%

2290.00

11%

1130.59

9%

7

Khammam

439000.00

9%

1598.34

1020.99

12%

192.15

205.05

8%

997.79

279.64

25%

2788.28

14%

1505.68

13%

8

Nalgonda

585000.00

12%

1445.41

778.92

9%

456.84

322.83

12%

114.92

78.09

7%

2017.17

10%

1179.84

10%

9

Ranga Reddy

230000.00

5%

706.70

765.86

9%

237.68

229.05

9%

299.60

135.66

12%

1243.98

6%

1130.57

9%

10

Hyderabad

1.00

0%

0.00

191.19

2%

0.00

604.23

23%

0.00

74.08

7%

0.00

0%

869.50

7%

TOTAL

4899001.00

 

14440.05

8290.25

 

2816.27

2585.62

 

2951.01

1129.57

 

20207.33

 

12005.44

 

Andhra Pradesh

7662000.00

61%

35548.65

20529.94

71%

4401.23

3691.17

59%

7067.07

2265.10

67%

47016.95

70%

26486.21

69%

Telangana

4899001.00

39%

14440.05

8290.25

29%

2816.27

2585.62

41%

2951.01

1129.57

33%

20207.33

30%

12005.44

31%

Total

12561001.00

 

49988.70

28820.19

7217.50

6276.79

10018.08

3394.67

67224.28

38491.65

 

http://www.slbcap.nic.in

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