Lockdown: Tobacco farmers seek rescue package as ₹4,400 cr crop unsold

Farmers body FAIFA on Monday (May 11) urged the government to provide a rescue package for tobacco growers, saying the crop worth ₹4,400 crore is lying unsold in the fields due to the coronavirus pandemic.

Federation of All India Farmer Associations (FAIFA), which claims to represent farmers and farm workers of commercial crops across Andhra Pradesh, Telangana, Karnataka and Gujarat, said demand for tobacco has weakened due to declining volumes of cigarettes and other tobacco products as a result of prolonged lockdown.

It also sought government intervention to reschedule crop loans for next two to three seasons, and allow farmers to repay the loans in splits of 30 per cent each per season.

“Failure to bail out the current duress for tobacco farmers will force many of them into debt trap which will virtually kill the ecosystem comprising of marginal farmers, workers, and people employed in handling and transportation activities while pushing the farmers to extreme measures,” FAIFA President Javare Gowda said in a statement.

FAIFA said in Gujarat 330 million kg of tobacco worth ₹2,700 crore is lying in the open fields as traders are not ready to pick-up the produce because the government has banned the sale of tobacco products.

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On the other hand, nearly 130 Million kg of flue cured tobacco worth over ₹1,700 crore is waiting to be sold as the auctions are moving at snails pace, causing quality loss under prolonged storage, it added.

Gowda further said, “We request the government to immediately start auctions in all the Tobacco Auction platforms”.

He said the government should also direct the Tobacco Board and other bodies to coordinate with FCV tobacco manufacturers, exporters and traders to facilitate reasonable prices (pre-COVID market prices) for FCV (flue cured virginia) tobacco produce at the auctions in Andhra Pradesh and Karnataka.

Urging Finance Minister Nirmala Sitharaman to intervene “to reschedule crop loans for next 2-3 seasons”, FAIFA General Secretary Murali Babu said the farmers must be allowed to repay the loan amounts in splits of 30 per cent each per season, while continuing the sanction of the regular seasonal loans.

“The decision will benefit millions of FCV tobacco farmers, their families and workers dependent on the industry, as they are already staring at burden of huge interests of non-institutionalized loans,” he added.