Farmers were badly affected by demonetisation, admits Agriculture Ministry

Union Agriculture Ministry has admitted in its report that around millions of farmers in the country were unable to buy seeds and fertilisers for their Rabi crops because of demonetisation. The report was submitted by the Union Agriculture Ministry to the Parliamentary Standing Committee on Finance.

The official claim has come after a day when Prime Minister Narendra Modi, in Jhabua, Madhya Pradesh, said that he used the bitter medicine of demonetisation to bring back money into the banking system and to give proper treatment to deep-rooted corruption system.

Chaired by Congress MP Veerappa Moily, the Parliamentary Standing Committee on Finance, was on November 20, briefed on the effect of demonetisation by the Ministries of Agriculture, Labour and Employment, and Micro, Small and Medium Enterprises (MSME).

According to a report in The Hindu, the report submitted by the Agriculture ministry said that demonetisation was brought into effect when the farmers were involved in either selling their Kharif crops or transplanting the Rabi crops.

Both these farming activities require huge amounts of cash, which demonetisation removed from the market. “India’s 263 million farmers live mostly in the cash economy. Millions of farmers were unable to get enough cash to buy seeds and fertilisers for their winter crops. Even bigger landlords faced a problem such as paying daily wages to the farmers and purchasing agriculture needs for growing crops.”

Attacking the Modi government for destroying the lives of lakhs of farmers during demonetisation, Congress president Rahul Gandhi said the farmers don’t even have money now to buy seeds for sowing. “But, even today Prime Minister Modi ridicules the misfortune of the farmer. This has now been corroborated by the Agriculture Minister,” added Gandhi.

The National Seeds Corporation (NSC) failed to sell nearly 1.38 lakh quintals of wheat seeds because of the note ban. The sale failed to pick up even after the government allowed the use of old currency notes of ₹500 and ₹1,000 for seed sales of rabi crops.

Standing Committee sent the team of bureaucrats from the Agriculture Ministry packing because the Secretary, Agriculture, did not show up, according to sources.

Opposition members raised sharp questions during the meeting. According to sources, AITC’ Dinesh Trivedi asked if the government was aware of a report by the Centre for Monitoring Indian Economy (CMIE), which stated that 1.5 million jobs were lost during January-April 2017 post-demonetisation. The Labour Ministry filed a laudatory report on demonetisation.

Ministry said that comparisons of quarterly employment surveys (QES) for the periods just before and after demonetisation revealed an increase of 1.22 lakh and 1.85 lakh respectively in the fourth and fifth round of the QES, in the total employment for establishments with 10 or more workers.

Farmers’ distress is an important issue in three of the five States that are facing Assembly poll: Madhya Pradesh, Rajasthan and Chhattisgarh.