Maharashtra to pay back Rs 768 cr to cotton farmers

The state government today announced that it will return Rs 768 crore to cotton farmers. The amount had been collected from the farmers since 1974 for creating the corpus of the Cotton Monopoly Purchase Scheme (CMPS).

Harshwardhan Patil, Maharashtra minister for agricultural marketing, said the state government was returning money as per the assurance it had given on the floor of the house.

For creating the corpus, the state government has been deducting 1 per cent of the farmer's total dues during 1974-1982 and 3 per cent from 1981 to 1993. However, from this year, the nature of the scheme has changed considerably as private traders have been allowed to purchase cotton directly from farmers.

The farmers have also been allowed to sell cotton outside the state. From this year, the state plans to purchase cotton only at the minimum support price (MSP) announced by the central government.

During the winter session of the state legislature, BJP leader Nitin Gadkari raised the cotton farmers' suicide issue and demanded the state should return the money it had taken from the farmers to create the corpus for CMPS. The state government had then given assurance to return this money.

Patil said the state government had collected Rs 173.17 crore till 1993 from the farmers. And with a 12 per cent interest, it came to Rs 768 crore. The state government would distribute Rs 350 crore in two months by account payee cheques to the farmers.

He said, "The payments would begin from Yavatmal district, where farmer suicides have been maximum."

Given the large availability of cotton in the domestic market, the state has asked the Centre to raise import duty on cotton from the present 5 per cent to 10 per cent, he added.