Farm credit offtake rises 57% during April-August

Farm credit offtake rises 57% during April-August

New Delhi: Farm loans disbursal surged by 57% till August this fiscal to 1.13 lakh crore as the government strove to mitigate the impact of drought on farmers through timely supply of credit.

“Farm credit worth Rs1,13,569 crore has been extended in the first five months of this fiscal against Rs72,236 crore in the corresponding period last year," a senior government official said.

“The government will definitely meet the target of extending Rs3.25 lakh in farm credit this fiscal," he added.

While presenting the Budget 2009-10, finance minister Pranab Mukherjee had announced farm loans at a subsidised interest rate of 6% for those who pay their dues in time and raised the agriculture sector credit target by 16% to Rs3,25,000 crore this fiscal.

At present, farm loans are extended at an interest rate of 7% per annum.

Mukherjee had said the Rs71,000 crore debt waiver scheme, announced during the Budget 2008-09, would be extended by six months till 31 December this year in view of the delay in monsoon.

Institutional credit to the agriculture sector touched Rs2,87,150 crore last year, exceeding the target of Rs2,80,000 crore.

According to the provisional figures, commercial banks disbursed Rs2,23,663 crore, which is 77.9% of the total farm credit last year.

Among the commercial banks, public sector banks disbursed Rs1,64,350 crore (57.2%) whereas private banks lent Rs59,313 crore (20.7%) to the agriculture sector.

Cooperative banks gave credit worth Rs36,762 crore (12.8%) and RRBs Rs26,724 crore (9.3%) in 2008-09.