West Bengal, the second largest potato producer in the country, has been facilitating credit for the farmers through potato stockists, mostly owners of cold stores with a buy-back arrangement.
“The West Bengal State Agriculture Marketing Board (WBSAMB) issues licences to cold store owners as per their storage capacity. A joint committee of the board and bankers decide the scale of finance to the store owners taking into consideration their storage capacity and the production cost of potato,” president of Odisha Cold Storage Association (OCSA), Janardan Sahu, said.
In fact, the Association has submitted a proposal in the regard to the state government.
The bankers sanction cash credit (CC) limit to cold storage entrepreneurs according to their licensed capacity and disburse the loan accordingly. The licensees get the loan during harvesting time and pay advance to farmers, stockists against their stock storing receipt and recover this advance with interest at the time of release of their stock, he said. If sufficient stock is not available from local farmers or stockists, the cold store owners purchase potatoes directly from farmers. “This is a win-win situation for the farmers and the cold store owners. There is no chance of distress selling of potatoes because of the buy-back arrangement,” Sahu said.
Since the 23 cold stores established in the private sector under the Odisha Potato Mission are on the verge of closure due to abysmally low capacity utilisation, Sahu said the West Bengal model would encourage local farmers to take up potato farming on a commercial scale.
Odisha is producing less than 1 lakh MT of potato in the last five years notwithstanding the state claim of an annual tuber production of over 2.5 lakh MT. The annual consumption of potatoes in the State is around 14 lakh tonnes which are mostly imported from West Bengal.
“As we depend on our neighbouring state for meeting the requirement of potatoes, we are at the mercy of West Bengal traders who determine the price. We have been requesting Odisha government to extend a similar credit facility for storing potatoes but in vain,” he said. The potato crisis will continue till the state government understands the basic problems, he added.
