Authorities asking Arakan farmers to repay agricultural loans

By Admin 28 Jul 2023

DMG Newsroom
28 July 2023, Sittwe

The Myanma Agricultural Development Bank and agricultural department have been asking local farmers in Arakan State, by phone or in person, to repay their outstanding agricultural loans.

U Ba Kyaw Sein, manager of the Arakan State branch of the Myanma Agricultural Development Bank, said: “We have been persuading farmers to pay back outstanding loans. The longer they take to pay back the money, the higher the interest will become. We can do nothing for them regarding the loan.”

Only about half of the farmers who took out agricultural debt last year have paid back their loans, according to the Myanma Agricultural Development Bank.

Many local farmers reaped a poor harvest last year due to high production costs and adverse weather conditions. Armed conflicts also disrupted cultivation in certain areas.

Meanwhile, Cyclone Mocha destroyed paddy seed stockpiles and killed cattle used to plough and for other farm work, making it difficult for local farmers to repay their loans. Many are struggling just to rebuild their homes damaged by Cyclone Mocha.

“The head of the General Administration Department has talked about loan repayment at the monthly meeting, and officials from the township agricultural department have also gone down to the fields and urged farmers to pay back their loans, saying new loans will not be issued to them unless they paid back old debts,” said U Maung Thein Hla, the administrator of Tin Htein Kan Village in Mrauk-U Township.

The bank provides 150,000 kyats per acre for a maximum 10 acres per farmer. The interest rate is 800 kyats for 100,000 kyats a month.

“Some farmers have repaid bit by bit since the harvest. Many planned to repay after they sold their harvest at high prices. However, the storm destroyed rice and cattle, and it is impossible to repay the loans,” said U Ba Thein, a member of the Rathedaung Township farmers union.

Some 80 percent of farmers in Rathedaung Township cannot repay their agricultural loans, he said.

The repayment period is from the monsoon paddy harvest to April.

“The bank should reduce interest for the convenience of both sides. As interest accumulates over time, farmers are struggling even to pay the interest,” said U Aung Kyaw Mya of the Rakhine Farmers Union, which he said has reported to international organisations and the military regime about the challenges facing local farmers in Arakan State.

There are 1.2 million acres of arable land available for paddy cultivation in Arakan State, and the state agriculture department targets to grow more than 1 million acres this year.