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Is loan waiver a panacea for rural distress?

Research published in The Financial Express highlights some of the best ways to help tackle distress among small and marginal farmers in Andhra Pradesh. Andhra Pradesh has one of the highest national rates of farmer suicides, at 47 self-inflicted deaths per 1000 population between 2010 and 2012.

New research by Professor Nilanjan Banik from Bennett University, Greater Noida studied responses to farmer distress in Andhra Pradesh examined three of the most relevant policy interventions: farm loan waiver program; improving cold storage infrastructure; and expanding local food processing facilities

The research findings suggest that of the three policies studied, the strongest option for Andhra Pradesh is improving cold storage infrastructure. This reduces waste of perishable fruits, vegetables and milk that command a higher market price than staple crops. Costs, including employees, storage, packhouses, and trucks, come to about INR 11,482 crores annually. The benefits in terms of the reduced wastage in milk, fruits and vegetables, are worth nearly nine-times that figure. 

Read more about the research in The Financial Express.