Sharad Pawar and Money Lenders

Sharad Pawar has asked farmers not to repay the loans given by the money lenders. Worse still he is planning to create a militia out of his party workers to neutralize the money lenders who still insist for repayment.

This stupid and irresponsible act should be stopped ASAP. Moneylenders, inspite of all their vices are an important part of the Indian society. They provide quick loans and short term credit to those who need it.
Indian banks often do not cater to people who live on daily wages. Micro credit organizations, in spite of all the hullah gullah demand very cumbersome and stringent rules. The poor need to organize themselves in groups, take collective responsibility for all the members in the group etc. In contrast, these money lenders don’t ask for any complicated compliance, they are ready to give whatever amount you want, whenever you want and have no foreclosure penalty. If you can produce some sort of surety (preferably in gold), the interest rates which the money lenders charge is less than what is charged by Micro-Credit organizations.

Indian banks are still living in the communistic era where they were a instrument to suck up all liquidity from the poor. Post offices, co-operations and banks still exist for the sole purpose of taking money/deposits from the poor and lending to the rich. However what India and esp its poor need is totally opposite. Flow of capital from those who have in excess to those who need it. So essentially, these individuals are a cost effective, simple solution to all the shortcomings of our fledging banking system.

If this call for large scale defaults and dismantling of the Money Lending business gains momentum (and there is no reason why it won’t), then the poor and entrepreneurs won’t get credit in time and at terms they want. They won’t be able to earn their living, expand their operations, get money for medical emergencies, or to pursue a trade which they know would be lucrative. So essentially Sharad Pawar is condemning the poor for eternal damnation.

 

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6 thoughts on “Sharad Pawar and Money Lenders

  1. While I too wish that moneylenders treat their defaulters humanely, to ask farmers to boycott the loans isn’t right. Who is going to re-imburse the moneylenders? The banks will be re-imbursed by the central govt. after all. If they are not, they could go out of business. the moneylenders too will go out of business but these are the very same people who give loans when the banks refuse!!

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  2. What sort of precident is this creating? Farmers can now assume that what ever money they borrow from banks or cooperative ones need not be repaid, and hence be casual about the same. Now if the same is advocated vis a vis money lenders also, it will on the long run impact and make losses to the farmers. No one would lend money to them. Instead of gifting free money,whose value may not be appreciated, the Govt can do more responsible things by helping them with the problems related to production, harvesting and distribution of crops.

    Destination Infinity.

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  3. @infinity
    welcome to ENagar.
    exactly. India is in the middle of an agrarian crisis. in spite of providing free loans, free water, subsidized electricity, subsidized fertilizers and seeds the agriculture is not viable.
    the productivity is so low that 55% of the 700million working class men just contribute 20% to the country’s GDP.we cannot even ask these people to migrate to cities, because cities are already over populated and cannot handle this influx.

    i have no idea how this situation can be improved

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  4. not singlehandedly – there was the junior madam too and many local politicians and patils

    on how to improve
    make them pay taxes file returns – make them work and mainly educate them with practical stuff populn control agriculture etc

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