President's Blog - Indebtedness drives peasants to suicide

A handful of big industrial houses such as Kingfisher, Ruias, Vedanta and DLF, owe lakhs of crores to banks (See Figure). When they default on their repayments, they are offered a “restructuring” of their debt servicing. Sometimes, their debts are written off outright if they declare bankruptcy. According to a report in Business Today, of the Rs 63 lakh crore of advances by the banking system, nearly Rs 10 lakh crore are "stressed assets" that were given to these defaulters. According to the RBI, as of December-end 2014, 647 cases with aggregate non-performing advances of Rs 4,52,940 crore had been referred to it. These business houses use their legal and monetary clout to evade punishment. To them honour, commitment and patriotism are subservient to the profit motive.

On the other hand, thousands of peasants have committed suicide under pressure from banks to repay their loans. The loans taken by these peasants are a pittance compared to the massive looting of banks by big industrial houses. The reasons for the inability of peasants to repay debts are genuine, unlike those of the “captains” of industry. Peasants are not able to pay due to poor monsoon, failure of cash crops, low public procurement prices, high cost of inputs, monopolization of agricultural trade and several other reasons. Rather than be called a defaulter, small farmers and agricultural wage workers decide to end their lives to keep their honour.


A report in the New Indian Express points out that the National Crime Records Bureau (NCRB) for 2014 reveals that of the 70 people who commit suicide everyday in India, over 33 are engaged in agriculture.

For the first time, the NCRB data on farmer-suicides distinguishes between the deaths of agricultural labourers and the deaths of farmers. Data show that there were 12,360 agriculture-related suicides in 2014, of which 6,710 were farm labourers and the rest, 5,650, were farmers. Of these farmers, 4,087 were small and marginal farmers, pointing to the particular vulnerability of this section.

The figures also reveal that over 20 percent of the farmers who committed suicide -1,163- were bankrupt or severely indebted. As many as 965 of these farmers committed suicide after going bankrupt due to a crop loan, while 952 killed themselves due to crop failure.

While two-thirds of all farmers killing themselves were aged between 30-60 years of age, and these are most likely to be the main breadwinners in the family. Five states alone - Maharashtra, Telangana, Madhya Pradesh, Chattisgarh and Andhra Pradesh - accounted for 86.6 per cent of the farmer suicides. Among the States, Maharashtra accounted for the maximum farmer suicides (2,568), followed by Telengana (898), Madhya Pradesh (826), Chattisgarh (443) and Karnataka (321).

Though Tamil Nadu reported less of farmer suicides comparatively, it should be noted that as many as 827 farm labourers committed suicide in the State last year, taking Tamil Nadu to number four position on overall agriculture related suicides after Maharashtra, Madhya Pradesh and Telangana.

The suicides of peasants are an outcome of the desperate situation to which they have been pushed to by the withdrawal by the state agencies from procurement at fixed prices, the increasing domination of agricultural trading multinationals over agriculture and increasing vulnerability of output prices to global prices and supply-demand fluctuations.

This deplorable situation calls for a drastic change in the economic orientation of the country. It calls for a complete overhaul in the way priorities are set by the government. At present the profit motive of trading monopolies have the highest priority in setting agricultural policies. This should give way to setting policies whose first priority will be to meet the needs of those who feed the country. Instead of subjecting peasants to harassment and pushing them to suicide, the government should address the reasons for their indebtedness and bankruptcy.

data 2

But this does not and cannot happen in the existing political process where people are marginalised and a small elite section of society decides on national priorities. Peasants have advanced demands for a universal public distribution system, for comprehensive insurance from crop failure, and for a government that ensures their prosperity and security. The present party-dominated political process, where a few political parties of the ruling elite set policies and manage affairs, is incapable of ensuring these demands. The plight of our peasantry point to the urgent need to establish a people-centred political process, where the vast majority of people including farmers and agricultural labourers, can orient the economy to serve their interests.

Posted In: Economy