NEW DELHI: To give a boost to the agriculture sector, the government may increase the farm credit target to around Rs 18 lakh crore. Budget 2022-23 According to sources, it will be presented on February 1.
For the current financial year, the government has set a loan target of Rs 16.5 lakh crore.
Sources said the government is increasing the credit target for the agriculture sector every year and this time too the target for 2022-23 is likely to be raised to Rs 18-18.5 lakh crore.
Sources said that this number will be withheld when the budget figures are finalized in the last week of the month.
The government sets annual agricultural credit, including crop loan targets, for the banking sector. There has been a steady increase in agricultural credit flow over the years, exceeding the target set for each financial year. For example, farmers were given loans worth Rs 11.68 lakh crore in 2017-18, much higher than the target of Rs 10 lakh crore set for that year.
Similarly, crop loans worth Rs 10.66 lakh crore were disbursed in the financial year 2016-17, exceeding the loan target of Rs 9 lakh crore.
Credit is an important investment for achieving high agricultural production. Sources said institutional credit will also help in separating farmers from non-institutional sources, where they are forced to borrow at higher rates of interest.
Normally, agricultural loans attract an interest rate of nine per cent. However, the government is providing interest subvention to help provide short-term crop loans at affordable rates and boost agricultural production.
The government is providing two percent interest subsidy to farmers to ensure short-term agricultural loans up to Rs.3 lakh at an effective rate of seven percent per annum.
For prompt repayment of loans within the due date, additional incentive of three percent is being given to the farmers, taking the effective rate of interest to four percent.
To increase the coverage of small and marginal farmers in the formal credit system, reserve Bank of India It has been decided to increase the limit of collateral-free agricultural loans from Rs 1 lakh to Rs 1.6 lakh.
Interest subvention is given to public sector banks (PSBs), private lenders, Cooperative bank and Regional Rural Banks (RRBs) on the use of their own funds and to nabard For refinancing of RRBs and Co-operative Banks.
For the current financial year, the government has set a loan target of Rs 16.5 lakh crore.
Sources said the government is increasing the credit target for the agriculture sector every year and this time too the target for 2022-23 is likely to be raised to Rs 18-18.5 lakh crore.
Sources said that this number will be withheld when the budget figures are finalized in the last week of the month.
The government sets annual agricultural credit, including crop loan targets, for the banking sector. There has been a steady increase in agricultural credit flow over the years, exceeding the target set for each financial year. For example, farmers were given loans worth Rs 11.68 lakh crore in 2017-18, much higher than the target of Rs 10 lakh crore set for that year.
Similarly, crop loans worth Rs 10.66 lakh crore were disbursed in the financial year 2016-17, exceeding the loan target of Rs 9 lakh crore.
Credit is an important investment for achieving high agricultural production. Sources said institutional credit will also help in separating farmers from non-institutional sources, where they are forced to borrow at higher rates of interest.
Normally, agricultural loans attract an interest rate of nine per cent. However, the government is providing interest subvention to help provide short-term crop loans at affordable rates and boost agricultural production.
The government is providing two percent interest subsidy to farmers to ensure short-term agricultural loans up to Rs.3 lakh at an effective rate of seven percent per annum.
For prompt repayment of loans within the due date, additional incentive of three percent is being given to the farmers, taking the effective rate of interest to four percent.
To increase the coverage of small and marginal farmers in the formal credit system, reserve Bank of India It has been decided to increase the limit of collateral-free agricultural loans from Rs 1 lakh to Rs 1.6 lakh.
Interest subvention is given to public sector banks (PSBs), private lenders, Cooperative bank and Regional Rural Banks (RRBs) on the use of their own funds and to nabard For refinancing of RRBs and Co-operative Banks.
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