Farm loan waiver

Today I attended a conference, there was a quote from one of the presenter that the loan waiver to farmers by Indian government was rape of the economy. He mentioned how great economist like Mr. Manmohan Singh and Mr. P. Chidambaram could do this act which did not make any economic sense.

After pondering over this issue I feel this is the most important action by the government and was wondering why this came so late. I believe this should have come 3-4 years earlier. I am thinking about the social and economical aspect and not the political aspect of the loan waiver.

Farming in India is one of the worst job that individuals undertake.
How many of us would like to be farmers?
If you look at the effort , the amount of capital invested and the returns you will find that the ROE is abysmally low. The period 1980-2005 was bad for the commodities and we did not see much in the food prices, whereas the price of the inputs rose (seeds, fertilisers, diesel etc).

Farm subsidies are being given by most of the countries (even developed ones!) to keep the inflation in control.

With the price of food grains now touching the roof throughout the world, you need to provide incentive to the growers to keep the prices in check and not force them to shun farming and become daily wage labourer in some industry.

Social Aspect
- People who leave farming migrate to the cities resulting in increase in the already populated cities.


My question is when Fed can bail out Bear Sterns then why not the Indian Farmers can be bailed out? Is Bear Sterns too big to fall and the farmers, who are feeding the 111 crore strong India too small!!!