Great Expectations

Forbes India travels to three hubs of agriculture and small & medium enterprises to gauge the extent of pain, and their expectations from the interim budget

- Monica Bathija

When Finance Minister Arun Jaitley rises in Parliament on the first day of February to present his government’s last budget of its five-year term, there will be at least two key constituencies of the economy that will be listening closely: The micro, small and medium enterprises and agriculture. Demonetisation and the Goods & Service Tax resulted in plenty of pain for the former, which will be hoping for incentives and relief in the interim budget. The beleaguered farm sector, too, will be hoping for relief in terms of loan interest waivers, lower insurance premiums and income support. Forbes India travels to three agri and small enterprise hubs to gauge the extent of pain of business owners and workers, and farmers, and their expectations from the last budget before the general elections. Here’s what our writers discovered. First stop: The perennially drought-hit Marathwada in Maharashtra, where farmers are on the brink.

Wanted: Loans, not Just Waivers

Farmers of Marathwada have a term for how they use bank crop loans disbursed during the July-October kharif season—“Nava juna”, meaning ‘new old’. They take the new loan to pay off their old loan, which they had taken the previous year from the shopkeeper of the store from which they buy seeds, fertilisers and the like.

Bank loans usually come too late for sowing purposes. Besides, farmers get only agricultural loans from banks. But since agriculture is reliant on the vagaries of nature, they also want general loans to develop their farms or start small businesses. Farmers want these loans to be based on their land value and proposals to develop their farms, rather than having banks think they will eventually seek loan waivers.