The Centre on Wednesday announced it would procure 1.22 lakh tonnes of red chilli from Andhra Pradesh and Telangana under the Market Intervention Scheme during the 2017 season to make up for losses resulting from an extraordinary fall in the prices of the crop. Distressed farmers have been burning heaps of their chilli crop, upset at the depression in prices that have followed massive overproduction.
Last year, as prices of dry chilli hit Rs 12,000 per quintal, lakhs of farmers in Telangana and Andhra Pradesh sowed the crop hoping for good returns this year. Production increased by 14% in Telangana and 25% in Andhra Pradesh. In Telangana, against an average of 2 lakh metric tonnes every year, nearly 7 lakh MT of chilli has been produced in 2016-17. In Andhra, production increased from 7.93 lakh MT last year to 9.22 lakh MT this year. As bags of chilli began to cause a massive glut in market yards in the first week of April, prices crashed by 50%. With prices still between Rs 5,000 and Rs 6,000 per quintal around April 25, frustrated farmers who had been holding on in the hope of getting Rs 10,000-12,000 per quintal, also started to sell.
Last Friday, as the Khammam Market Yard opened after 2 consecutive local holidays, stock that is usually around 60,000 bags, had swollen to nearly 2 lakh bags. As the auction began, there were no takers at even Rs 5,000 per quintal — the chairman and secretary then fixed prices at between Rs 3,000 and Rs 4,000 per quintal, depending on the variety of the chilli. Infuriated chilli farmers went on the rampage, vandalising the offices of the chairman and secretary, and setting furniture on fire. They accused officials of being hand-in-glove with commission agents to keep prices low.
On Monday, the protests (above) spread to Warangal. In Guntur, the biggest chilli market, farmers blocked NH 16 and set fire to heaps of the crop, demanding government intervention with a support price. The Opposition YSR Congress Party chief Y S Jagan Mohan Reddy went on a hunger strike, demanding compensation for farmers.
The TRS and TDP governments in Telangana and Andhra respectively are under fire from Opposition parties for not helping the farmers who say they won’t even get their investment back. Fearing an ugly confrontation with the Congress, the TRS did not allow a debate on chilli prices in the special session of the Legislative Assembly held on Sunday to approve the Telangana Land Bill.
AP has announced financial support of Rs 1,500 for every quintal over and above the price that the farmer gets, which would be transferred directly to his account, but has capped the support at 20 quintals per farmer.
Officials say around 4 lakh farmers in the two states are affected. The states made a representation to the Centre, seeking help and funds to offer a support price to the farmers. Telangana’s Irrigation and Marketing Minister T Harish Rao wrote to Union Agriculture Minister Radha Mohan Singh seeking 50% central assistance under Market Intervention Scheme. Singh took up the matter with senior minister M Venkaiah Naidu, leading to Wednesday’s intervention. Earlier, Labour Minister Bandaru Dattatreya had met Naidu along with leaders and public representatives from the states.