Pb to fix limit on per acre loan, interest rate lending to farmers

To ensure that State’s beleaguered farmers reap the benefits of what they sow, Punjab Government on Thursday took two major decisions for their welfare — streamline money lending system, and creating prices stabilisation fund to ensure MSP of their produce.

The decisions, taken by the Cabinet in its meeting, would be implemented by way of law. The government would table the Punjab Settlement of Agricultural Indebtedness Bill, 2018, and introduce amendments in Punjab Agricultural Produce Markets Act, 1961, in the ensuing session of the Vidhan Sabha, starting from Friday.

Deciding to streamline the system of money lending to the farmers, the Government has proposed fixing a limit on the advance on per acre of land, with the rate of interest also to be duly determined by the government.

The Bill, approved by the Cabinet, is aimed at further relieving the state’s farmers from the vice of debts, and has proposed a series of measures to protect the interests of the farming community, saving them from the clutches of unauthorized money lenders who charge exorbitant rates to give unlimited amounts as loans.

With the enactment of the Bill, only licensed money lenders will be allowed to advance the money, with lending by others deemed to be illegal. Only the licensed money lenders will be allowed to move the debt settlement forums, which will be headed by Commissioners, and the lender would be required to submit proof of the amount lent to the farmer.

It has also been decided to bring down the total number of debt settlement forums from 22, as per the existing Act passed in 2016, to five. The new forums would be constituted at the divisional levels which would help in ensuring a more systematic approach to handling farm debt cases.

The decision to amend the existing law on farm loans has been taken to curb the growing trend of agricultural indebtedness, resulting in mismatch between prices of agricultural inputs and minimum support price of agricultural produce, said the spokesperson.

Spokesperson said that the farmers raise loans from both institutional and non-institutional resources. “However, while the institutional loans are regulated through various special legislations governing the institutions providing such loans, non-institutional loans are largely unregulated having no mechanism for redressal of grievances of debtor,” he said.

In the light of this, the Government has, thus, enacted the Punjab Settlement of Agricultural Indebtedness Act, 2016, which provide a framework for regulation and settlement of agricultural debts.

PRICES STABILISATION FUND TO ENSURE MSP

Punjab Cabinet has also approved a Bill to create a Price Stabilization Fund to ensure that farmers in the state get the Minimum Support Price (MSP) for their produce.

The Bill, to be tabled for enactment in the Vidhan Sabha session, is aimed at protecting the interests of farmers in the event of a sudden fall in prices of certain agricultural commodities below normal prices. It will bring about amendments to Section 25 (A), 26 and 28 of the Punjab Agricultural Produce Markets Act, 1961.

As per the amendments, contribution will be charged out of the commission charged by arhtiyas (commission agents) towards Agricultural Produce Price Stabilization Fee.

The Market Development Fund and Market Committee Fund are being amended by inserting new clause (xxii) after section 26 and 28 of the Punjab Agricultural Produce Markets Act, 1961, so that these funds can also be used in the Price Stabilization Fund.

The step has been taken in view of the pitiable condition of the state’s farmers, pushing many of them to suicide in the recent past.

The State Government has already taken several other path-breaking initiatives for the welfare of the beleaguered farmers, including waiver of debts of small and marginal farmers.