CHENNAI: The sector to take the biggest hit from the Central Government’s demonetisation decision may just turn out to be farming, especially the next rabi crop, if soundings taken by The Sunday Standard across the South are any indication. Shut out of banks and starved of cash for inputs like fertiliser, seeds and pesticides, farmers across the south have slashed their rabi sowing, at some places by more than half the normal acreage.
In Ballari, Karnataka, farmers who had already sown crops when `500 and `1,000 notes were withdrawn from the market on November 8 are not much better off and face the risk of losing the investment they had already made. One farmer, Lepakshi Naidu in Hosapete taluk, Karnataka, said he had sown 30 acres of chilli prior to November 8. Now he is unable to pay his workers as the banks are not allowing to withdraw more than `2,000 per day. The loss of crop over 30 acres could cripple his hopes, he said.
Pesticide dealers confirmed that rabi sowing is down by 80 per cent in Ballari and by at least 40 per cent in Telangana, where a fertilizer trader said he would normally do business of `20-25 lakh per day, but had not sold a single bag of fertilizer in the week. Farmers across the peninsula said they would trade their produce for a deep discount if only they would be paid in low-denomination bills. But with no one having small notes, that was a remote possibility.
Not that such farmers are happier. Most have put their money in the bank and are now effectively shut out of any access to it. It’s been a vicious cycle for farmers be it in Tamil Nadu, Kerala or Telangana.
If in Kerala farmers are unable to repay their loans because their procurement incomes have been delayed, cultivators in Nalgonda, Telangana, said the loans from moneylenders and deposits in banks are out of reach as well while they pay interest on loans.