Farmer Suicides Due To Bankruptcy Or Indebtedness: U’khand HC Asks Centre To Compensate Them, Take Supportive Measures [Read Judgment]

Moved by the grim scenario in which farmers in the state are committing suicide due to bankruptcy and indebtedness, the Uttarakhand High Court has asked the state government to prepare a scheme for payment of compensation to the bereaved families, create a corpus for waiving off their loans while also passing a series of directions for the state government and the Centre to ensure farmers get good returns for their labour and are insured against any losses due to reasons beyond their control.

A bench of Justice Sharad Kumar Sharma and Justice Rajiv Sharma asked the Centre and the state government to provide legal status to Minimum Support Price.

The court was hearing a public interest litigation moved by Dr. Ganesh Upadhyay highlighting the incidents of suicide committed by the farmers in the State of Uttarakhand.

He had submitted that “there is abject poverty, high levels of indebtness and crop failures leading to suicides. Four farmers in the State of Uttarakhand have committed suicide. After coming into existence of State of Uttarakhand, more than 2.26 lakh families of farmers migrated from the hill districts of the State”.

Before passing the directions, the court noted that the farmers have a right to live with dignity and since the farmers are not able to repay the bank loans, they borrow money from local money lenders at an exorbitant rate of interest. There is delay on the part of government agencies for making payment to the farmers.

It is to be noted that according to the data compiled by the Akhil Bhartiya Kisan Mahasabha, in 2016-17, only 20% agricultural land exists in the hilly areas for cultivation and remaining 80% is either lying barren or has been sold for commercial purposes. A large size of crops is also damaged by wild animals. The total cultivated area in the State is about 7,84,117 hectares. About 90% of population of the State depends on agriculture for its livelihood.

Below are the directions passed by the court:

1. The State of Uttarakhand through the Chief Secretary is directed to constitute the State Farmers Commission, as per Section 3 of the Uttarakhand State Farmers Commission Act, as amended from time to time, (hereinafter to be referred to as the Act) and to appoint its President and Members u/s 4 of the Act, within three months from today. The Board shall start discharging the duties u/s 9 of the Act immediately after its constitution and appointment of its President and Members.


2. The respondent no.1-Union of India and respondent no.5- State Government through the Chief Secretary are directed to implement the broader recommendations made by the National Commission on Farmers (NCF), constituted on November 18, 2004 under the chairmanship of Prof. M.S. Swaminathan, to consider providing MSP (minimum support price) for the agricultural produce grown/harvested by the farmers in the State of Uttarakhand which should be at least three times above the average cost of production (C2) by taking into consideration the comprehensive cost including imputed rent and interest on owned land and capital as well as hired labour, cost of seeds and fertilizers, machinery, expenses incurred on irrigation, rent of leased land, labour put by farmers and their families.


3. The State Government is directed to formulate the Scheme for payment of compensation/family pension to the families of farmers who have committed suicide.


4. The State is suggested to formulate a Scheme for providing insurance cover including weather insurance to the farmers for their crops in consultation with the National Insurance Companies along with stakeholders at minimal premium.


5. The Reserve Bank of India is advised to evolve a Scheme in consultation with the Banks, State Government and stakeholders about the manner in which the agricultural loans are to be advanced and their recovery and also waiver of loans in the eventuality of suicide committed by the farmers.


6. The State Government is directed to consider formulating a Scheme for waiver of loans raised by small marginal farmers, at least upto Rs.50,000/- or in the alternative to permit them to pay the loans in installments by reducing their rate of interest, if need be by creating corpus in consultation with Nationalized/Gramin/Cooperative Banks.


7. The respondent no.1-Union of India and no.5-State Government are also directed to give wide publicity immediately after fixing of Minimum Support Price at the time of sowing to boost the income of agriculturists.


8. The State Government is directed to ensure enforcement of the Warehousing (Development and Regulation) Act, 2007 in letter and spirit to enable the farmers to store their produce and to prevent them from selling their produce under distress.


9. The State Government is directed to prepare the App in consultation with the Department of Technology and private players to have the up-to-date Khasra-wise data of the status of crops grown in the State of Uttarakhand within a reasonable period.


10. We suggest the respondent no.1 Union of India and no.5 -State Government to provide legal status to the Minimum Support Price (MSP) by bringing a suitable legislation.

The court made it clear that ‘agriculture produce’ would mean all produce and commodities, whether processed or unprocessed of agriculture, horticulture, apiculture, sericulture, livestock and products of livestock, fleeces (raw wool) and skins of animals, forest produce and fisheries for the purpose of determining three times above the average cost of production.

The court also noted that, “The farmers are debt-ridden. They are not in a position to repay the debts due to ever decreasing prices of their produce. The worst affected are small and marginal farmers. Sometimes, they take recourse to extreme measures such as suicide etc. It is expected from the State to provide a mechanism to reduce their burden by creating a corpus to waive off their loans at least to the extent of Rs. 50,000.

“Most of the agricultural land in the State of Uttarakhand is rain-fed. Whenever there is scanty rain, the crops fail. The State is required to formulate a Scheme providing insurance cover to their crops in consultation with the National Insurance Companies at minimal premium”.