The piece de resistance

In each of its five Budgets, this Government has had one triumphant item – agricultural credit. In each Budget, Chidambram has proclaimed higher and higher targets, and in each he has announced that the target has been exceeded. In the new Budget, he says that, as against Rs. 100,000 crore that were disbursed when this Government assumed office, Rs. 280,000 crore shall be disbursed as rural credit in 2008/09.

Surely, that very fact should have alerted the Government that either the credit is not reaching those who need it most, or that their problems are not going to get solved by credit alone. As suicides have mounted, as the agrarian crisis has barged more and more into its face, the Government has done what it always does – it has appointed committee after committee: the Swaminathan Commission; the Radhakrishna ‘Expert Group on Agricultural Indebtedness’; the A. Vaidyanathan ‘Task Force on Cooperative Banking’; the RBI’s ‘Working Group on Distressed Farmers’ headed by Sardara Singh Johl; the RBI’s ‘Technical Group to Review Legislations on Money Lending’ headed by SC Gupta.

Second, it has rained package after package:

•2% remission in interest rate – 1,700 crore were provided for this in the 2006/07 Budget;

•The Backward Regions Grant Fund: in the 2006/07 Budget, Chidambram announced that he would disburse Rs. 5,000 crore; this year he pledges to disburse Rs. 5,800 crore;

•In July, 2006, Government announced the PM’s special package for distressed farmers of 31 districts in four states. In the 2007/08 Budget, Chidambram announced that Rs. 16,979 crore would be spent under this special package. The usual panoply of institutions have been set up to implement and monitor the package: state-level committees consisting of representatives of central and state government, district level committees and Panchayati Raj institutions, and ‘appropriate institutional structure and special purpose cooperatives/community based organizations at the local level for delivery of the package and optimum utilization of resources in a time-bound manner.’

... contd.