Cash crunch hits Himachal potato growers

Una (Himachal Pradesh), Nov 22 (IANS) Hardly any trader is buying potatoes in this Himachal Pradesh town this season owing to the cash crunch after demonetisation of high-value currency notes. Normally, potatoes here sell like hot cakes.

“There is hardly any wholesaler or agro commodity trading house to buy potatoes in this area. Most of the farmers have been forced to sell the produce at rates almost less than the actual cost of production,” Najaib Gill, a prominent potato grower on the outskirts of Una town, told IANS.

He said this is the season when potatoes grown in low-hills of the state, mainly in Una district, command monopoly in the markets of north Indian states of Punjab, Chandigarh, Haryana and Delhi.

He said there is a huge demand for the potatoes in the plains.

“Since the production (in the hills) is optimal and the demand is high in the plains, we are not getting adequate prices as the traders say they have no cash in new currency notes,” he added.

Potato is one of the major cash crops grown in the lower and mid-hills of the state. Una district alone harvests potatoes on 700 hectares.

The state’s potato yield was around 200,000 tonnes in 2015-16, while estimates this fiscal put the produce at 195,000 tonnes, according to the Himachal Pradesh Economic Survey for 2015-16.

Besides Una district, the table potato is also cultivated in Bilaspur, Kangra, Mandi, Shimla, Solan and Kullu districts.

The Lahaul Valley in Lahaul-Spiti district is known for producing virus-free potatoes that mainly find a market for plantation.

Sarvjit Singh Dogra, state Agricultural Produce Market Committee Secretary in Una town, told IANS that a 50-kg bag of potatoes is fetching between Rs 400 and Rs 425 in Una, while it sold for around Rs 800 last year.

Currently, potatoes are being retailed at Rs 30-35 per kg across the country.

Growers are facing many hardships. Many are being forced to accept old currency notes.

“For more than a week there was no bulk buyer for potato. Finally, we have decided to sell the entire produce at almost half the rates by accepting old currency notes of Rs 1,000 denomination,” said a farmer, requesting anonymity.

He said if the government could allow use of old high denomination notes for purchasing seeds, it should also be liberal with the growers for accepting the banned notes for their produce till the new currency is in full circulation.

Field reports say most of the farmers have delayed the harvesting of the potatoes till the prices spike again.

Last week, Chief Minister Virbhadra Singh expressed concern over lack of enthusiasm among the traders during centuries-old Lavi Fair, synonymous with trade in traditional items like hand-knitted woollens, farm implements and dry fruits as well as horses, yaks, sheep, at Rampur town, some 130 km from the state capital.

The fair too was hit hard by the demonetisation decision.

“It’s unfortunate that this year the trade fair was hit by the demonetisation of currency notes. People showed less enthusiasm during the fair as compared to previous years due the Centre’s decision,” the Chief Minister said at the fair’s closing ceremony.

Himachal Pradesh annually earns Rs 2,500 crore from the cultivation of vegetables, while horticulture generates more than Rs 3,200 crore annually.

(Vishal Gulati can be contacted at