The Federation of All India Farmer Associations (FAIFA) has appealed to the Union Government to save the livelihood of tobacco farmers as the demand for the crop has weakened due to declining volumes of cigarettes and other tobacco products due to the lockdown.
It said nearly 130 million kg of Flue Cured Tobacco worth over ₹1,700 crore is stuck as the tobacco auctions are moving at a snail’s pace, causing quality loss under prolonged storage.. In Gujarat, farmers, whose tobacco produce is used in the making of beedis and other tobacco products, are also struggling for livelihood, FAIFA said. “More than 330 million kg of tobacco worth ₹2,700 crore is lying in open fields as the traders are not ready to pick up the produce because government has banned the sale of tobacco products,” it said.
Rains are expected in the coming days and if the government does not start the sale of tobacco products, both traders and farmers will go bankrupt, it added.
This year, the demand has been very weak from the traders and manufacturers due to rising inventory of cigarettes in the market during the lockdown and delay in export shipments.
More than 95% crop is waiting in barns to be sold and FCV tobacco farming community of Andhra Pradesh is estimating a loss is excess of ₹200 crore because of quality deterioration and weight loss.
Javare Gowda, president, Federation of All India Farmer Associations (FAIFA), said, “We request the government to immediately start the auctions in all the Tobacco Auction platforms.”
“The government should also direct the Tobacco Board and other officials concerned to coordinate with FCV Tobacco Manufacturers, exporters and traders to facilitate reasonable prices (pre-COVID-19 market prices) for FCV tobacco produce at the auctions in Andhra Pradesh and Karnataka,” he said.
“As FCV tobacco farmers are undergoing severe financial crisis, we request the Government of India to immediately sanction a compensation amount of ₹25,000 each to all registered FCV tobacco growers for their very survival,” he added.
“Failure to bail out the current duress for tobacco farmers will force many of them into debt trap, which will virtually kill the ecosystem comprising marginal farmers, workers, and people employed in handling and transportation activities while pushing the farmers to extreme measures,” he added.
Murali Babu, general secretary, FAIFA, said, “We request Finance Minister Nirmala Sitharaman to impress upon the RBI and the State Level Banker’s Committee to reschedule the crop loans for next 2-3 seasons and allow the farmers to repay the loan amounts in splits of 30% each per season while continuing the sanction of the regular seasonal loans.”
“The decision will benefit millions of FCV tobacco farmers, their families and workers dependent of the industry, as they are already staring at burden of huge interests of non-institutionalised loans,” he said.
FAIFA has also demanded for a comprehensive FCV Tobacco Production plan for 2020-21. Tobacco Board should make more efforts to promote Indian exports studying opportunities arising out of COVID-19.