Farmers still in interest trap
Almost a year after the state government promised to impose stringent laws to arrest the exploitation of farmers at the hands of private moneylenders, the rate of borrowing has gone up to 36-40% in the state.
The laws remain on paper as the government has failed to put in place any regulatory body that could take action against the private moneylenders in the state. Highly-placed sources in the government said, “The case of Congress MLA Dilip Sananda, whose family runs a moneylending business, may have come to light because the Supreme Court passed strictures against former chief minister Vilasrao Deshmukh for interfering in the work of the police by not allowing action against Sananda. But there are thousands of farmers who are still victims of the system, which allows moneylenders to loan funds on high rates of interest.”
According to the Maharashtra Money Lenders (regulation) Act, moneylenders have to return the land acquired from the borrowers (farmers) against the loans. It is also mandatory for the moneylenders not to charge high interest rates from the farmers. On an average, the rate of interest for agriculture loans is as low as 6-7%. But the records show that private moneylenders always charge a higher rate.
According to Kishore Tiwari of Vidarbha jan Andolan (VJAS), “The government has put stringent laws against moneylenders on paper . But what is the use if they cannot define the roles of implementing agents? If the police act, the moneylenders lodge a complaint that it is not a competent authority to act, as the licences are issued by the assistant registrar (revenue department).”
What is shocking is that the moneylenders, instead of mortgaging the farmers’ land, enter into sale deal as a bargain to waive off the loans. As a result it gets difficult to challenge the moneylenders’ act in the court of law.
There are also reports that, despite strict laws, the number of private operators in the state and Andhra Pradesh has shown an increase over the years. Even the state economic survey indicates that number of farmers dependent on private moneylenders has increased, after state’s and Centre’s massive agriculture packages.