Distressed Andhra Pradesh farmers selling organs to escape debt trap

NEW DELHI: Almost five years after the UPA government allocated the lion's share of its Rs 52,000 crore farm loan waiver scheme to Andhra Pradesh, reports are emerging from the state that distressed farmers are selling their organs to come out of the agricultural debt trap.

Three states - Andhra Pradesh, UP and Maharashtra - had got almost 57% of the Rs 52,000 crore package meant for all 35 states and Union Territories. Disbursal in Andhra Pradesh was Rs 11,000 crore while it was Rs 9,095 crore in UP and Rs 8,900 crore in Maharashtra.


The farm loan waiver has been cited as one of the main vote-catchers for the Congress in the 2009 LokSabha polls and this was vindicated in the party's handsome performance in the three states with the largest allocations. While Congress bagged 31 seats in Andhra, it got 22 in UP and 16 in Maharashtra, a performance which facilitated formation of the second UPA government at the Centre.
In Andhra Pradesh, around 77 lakh farmers cornered more than Rs 11,000 crore, almost 21% of the total farm loan waiver package. But as the Comptroller and Auditor General (CAG) report reveals, a huge number of ineligible farmers were allowed waiver while many marginal and small farmers were denied the benefit and they continued to remain in a debt trap.

CAG detected tampering with loan records, alteration in ledgers and changing records where non-agricultural loans were converted into agricultural loans.

In one such instance, the auditor pointed out how the AP Grameen Bank in Ballikurava had altered land holdings of at least 17 loanees so as to alter their category and make them eligible for full waiver in the marginal farmer category.

These irregularities were noticed not just in Andhra Pradesh but across several states were sample study was carried out by the auditor.

The CAG's sample study was carried out over 715 bank branches in 92 districts of 25 states involving more than 80,000 farmers' loan accounts. The disbursement to these farmers amounted to Rs 330 crore.

In Andhra Pradesh, scrutiny of 3,200 loan accounts revealed that in at least 132 cases, ineligible benefits were allowed, highest among all states bar J&K where the sample study found ineligible benefits were allowed to 153 farmers. In close to 100 cases in Andhra Pradesh, the CAG found benefits extended to farmers on loans which were not disbursed in the first place.