Sustainability allowance must

Abstract

In the recent weeks, there have been a spate of farmer suicides in the country most probably because of inclement weather and crop failures. In fact, on a single day, according to press reports, recently, there were 9 suicides in Karnataka and more than 150 in last four months. The main reasons for the suicides are financial distress and indebtedness, largely fuelled by erratic monsoons. Traditionally, according to data released by the government, nearly half of farmer suicides are on account of financial distress. Illustratively, in 2014, 2755 of 5650 farmer suicides could be attributed to factors like indebtedness (1163), failure of crops (952), natural calamities (491) and poverty (149). The farmers are in financial distress for various reasons. First and foremost, they lack financial literacy because of which they tend to take loans beyond their repaying capacity. As a number of financial institutions are operating in rural areas, farmers succumb to the opportunities and avail loans from different sources. Quite often, over and above, long term loans from formal institutions, farmers also choose to take short term loans in the hope of a good harvest.

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