Farmers' Indebtedness in Haryana: A Study

Abstract

Farmers' Indebtedness in the State emerged as a central issue. This is because, the problem of indebtedness, damaged the social status of a farmer and triggered to commit suicide. In India, on an average, there is one farmer suicide in every 30 minutes since 2002 [Sainath: 2008a], while in case of Haryana, the suicide number of farmers is 4.8 per one lakh farmers [NCRB]. Therefore, the issue of farmers’ indebtedness becomes a matter of intense debate for whole of the country and as well as for Haryana. In this background, the present study is conducted to assess the status of farmers’ indebtedness in the State in detail. The results of the study indicate that the informal mechanism of credit delivery is playing an important role for marginal and small farmers in meeting their credit requirements in the State. Seventy one per cent loans to total loan were used in productive activities in Haryana, while in case of India the same ratio was 73.10 per cent. Marriage and other ceremonies were the major unproductive expenses in Haryana, which were higher as compared to aggregate India and it is more in SC and BC community in the State. In addition, maximum indebtedness was found to be ` 25289 on the 615-775 MPCE class farm households in the State and the status of Scheduled Caste and Backward Class farm households is not better, while on an average the status of farm households belonging to other social group of farming community is better in the State as compared to India as aggregate. The size of landholding is also negatively associated with informal borrowing. On the basis of foregoing analysis, we suggest that the State government should monitor the informal mechanism of credit, increase the awareness among farmers in general and marginal and small in particular, about the disadvantages of utilisation of loan in unproductive activities, and strengthen the cooperative movement in the State.