Panel calls for farm loan at 4%

The working group on agricultural production, constituted by Prime Minister Manmohan Singh, has suggested that the government should provide farm loan at not more than four per cent rate of interest and the minimum support price (MSP) be fixed at 50 per cent higher than the cost of cultivation.

A report in this regard was submitted to the Prime Minister in New Delhi by the Working Group on Agriculture Production, headed by Haryana Chief Minister Bhupinder Singh Hooda.

The group, which also has chief ministers of Bihar and West Bengal as members, had been set up to deliberate and recommend strategies and an action plan for increasing agricultural production and productivity, including long-term policies to ensure sustained agricultural growth.

The working group has also favoured a comprehensive policy for extending the insurance cover to all crops and livestock for which funding support should be extended by the Centre.

It has also recommended higher investment in the power sector to ensure easy availability of energy to farmers. The working group has also called for more investment in agricultural research to develop high-yielding varieties.

The report suggests the National Agriculture Insurance Scheme should be made farmer-friendly and a village, not the block, be made into a unit. Norms of the Calamity Relief Fund (CRF) should be revisited and compensation for the loss of crops due to natural calamities like flood, drought and frost be increased to at least Rs 25,000 per hectare. With a view to promoting mechanisation of farming, the working group wants all types of tools, machinery and equipment allowed be freely imported without any import duty.

It also suggested policy interventions on a mission mode basis and adoption of region-specific technologies to bridge the gap of crop yield across the country. While below the national-average states should adopt improved practices to scale up to the national average, those having above national average should aim at reaching the highest yield in the country. “This twin approach alone can give an estimated additional 81.37 million tonnes of food grains, and 5.35 million tonnes of oilseeds,” the report says.