Farmers hit by slumping tea prices

Mangalbare, August 1:

Decline in the price of tea leaves year after year has hit farmers who started tea farming with bank loans.

The Agriculture Development Bank-Nepal (ADBN) said many tea farmers have are unable to pay the instalment and interest on loans. Over 365 farmers have taken loans worth Rs 58.8 million from the bank’s Ilam branch.

Likewise, 1,901 farmers have taken loans worth Rs 45.93 million from the Fikkal branch while 55 farmers have taken loans worth Rs 2.82 million from the Mangalbare branch.

According to the bank, repayment deadline for loans worth Rs 19.75 million issued from the Ilam branch has expired. The branch is yet to recover Rs 32.65 million in interest alone.

The Fikkal branch is yet to recover Rs 9.16 million and Mangalbare branch Rs 2.2 million in capital and interest amount from the farmers. Of this amount, loans worth Rs 1.53 million have already crossed the repayment deadline.

Saying that investment in tea farming did not prove satisfactory, the bank had odecided to stop lending anymore to this sector. But it had to rollback the decision after the farmers’ strike. Farmers said they were unable to repay loans as they were forced to sell their produce at prices lower than expected. They have also demanded that the bank waive fines on tea farmers failing to repay the loan on time.