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Agri credit target increased by Rs 1 lakh cr for 2012-13

FM raises the outlay for farm sector by about Rs 3,000 crore.

Written by Agencies | New Delhi | Published: March 16, 2012 12:38:32 pm

Finance Minister Pranab Mukherjee today announced Rs 1,00,000 crore increase in the agriculture credit target to Rs 5,75,000 for the next fiscal and raised the outlay for farm sector by about Rs 3,000 crore.

“Agriculture continues to be a priority to the government. The total plan outlay for agriculture and cooperation has been increased by 18 per cent from Rs 17,123 crore in 2011-12 to Rs 20,208 crore in 2012-13,” Mukherjee said in his budget speech.

The allocation for scheme “Bringing Green Revolution in Eastern India” was also increased by Rs 600 crore to Rs 1,000 crore in next fiscal considering the success of the programme that led to an additional paddy production of 7 million tonne in the Kharif season of 2011-12 crop year.

The allocation for Rashtriya Krishi Vikas Yojna (RKVY) was also increased by 17 per cent to Rs 9,217 crore.

“Farmers need timely access to affordable credit. I propose to raise the target for agricultural credit in 2012-13 to Rs 5,75,000 crore. This represent an increase of Rs 1 lakh crore,” he said.

The credit target for this fiscal has been set at Rs 4,75,000 crore. During April-November period,credit worth Rs 2,94,023 were disbursed by banks to farmers,according to data provided by Economic Survey.

“The outlay for Rashtriya Krishi Vikas Yojna is being increased from Rs 7,860 crore in 2011-12 to Rs 9217 crore in 2012-13,” Mukherjee said.

Mukherjee allocated Rs 10,000 crore to the National Bank for Agriculture and Rural Development (NABARD) for refinancing regional rural banks (RRBs) to disburse short-term crop loans to small and marginal farmers.

The short-term crop loans scheme offering 7 per cent interest rate per annum would continue during the next fiscal and those farmers who repay in time would continue to get crop loans at 4 per cent interest rate.

In order to reduce post-harvest losses,he announced that farmers would also be eligible to get post-harvest loans up to six months at 4 per cent interest rate provided they keep their produce in warehouses.

Stating that Kisan Credit Card (KCC) is an effective instrument for making credit available to farmers,the minister said that the KCC scheme will be modified to make the KCC smart card to be used at ATMs.

The minister set aside a sum of Rs 200 crore for incentivising scientific research to raise farm yields and develop seed varieties that are resistant to climate change.

Pointing out that water scarcity could threaten agriculture production in the coming decade,Mukherjee felt the need to dovetail micro-irrigation scheme with water harvesting scheme.

He said structural changes are being made to the Accelerated Irrigation Benefit Programme (AIBP) to boost investment in irrigation projects.

The minister stepped up allocation for AIBP by 13 per cent to Rs 14,242 crore. He announced that a government-owned irrigation and water resources company would be operationalised in 2012-13 to mobilise large resources to fund irrigation projects.

To boost food processing sector,Mukherjee announced a new centrally sponsored scheme National Mission on Food Processing that would be started in cooperation with the state governments in 2012-13.

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