Currency crunch worsens, farm prices plunge in Gujarat

The disruption in cash supply in the market has shrunk the income of farmers in Gujarat. With bank vaults and ATMs going dry, traders are left with little liquid money to buy agricultural produce, which in turn has affected the earnings of farmers.

According to Gaurang Patel, chairman of the Unjha Agriculture Product Marketing Committee in north Gujarat, farmers prefer cash dealings as there is no easy access to banks in villages. They also need to pay to labourers in cash.

"Farmers are still to adapt to cashless transactions. The prevailing shortage has resulted in the prices of agricultural crops drop between 5 per cent and 10 per cent," said Patel.

The APMC functionary said a kilo of fennel seeds today fetches Rs 1,500, which is a fall of Rs 500 when there was no cash shortage. While it is compulsory that all transactions of Rs 2 lakh and above to be through cheque or other digital means, there is not enough cash for smaller transactions, he said.

Unjha APMC is the largest market dealing in commodities like cumin seeds, fennel seeds, isabgol, castor, and sesame.

Farmers from Rajasthan, Madhya Pradesh and Maharashtra come here to sell their produce.

The currency crunch has also affected milk producers in Arvalli district of north Gujarat. They have approached the collector saying they are unable withdraw money earned from selling milk to local cooperatives.

"As a part of the Digital India campaign, their earnings were deposited in banks. The money is deposited on 3rd, 13th and 23rd of every month. However, recently when they went to ATMs to withdraw money, there was none," said Sagar Rabari, general secretary of Gujarat Khedut Samaj. Similar complains have also come from Mehsana and Mahisagar districts, he said.