Perennial crops in drought-hit states get interest subvention

The Union ministry of agriculture has decided to extend the interest subvention or subsidised crop loan scheme to perennial crops in the drought-affected states of Gujarat, Maharashtra, Karnataka and Rajasthan.

The present provision is only for seasonal crops. Those for perennial crops would be shortly launched as a full-fledged scheme for these states, said official sources.

Under the scheme, a farmer is eligible for the crop loan which is short-term (a year) in nature. In the case of horticultural crops like tomato, banana, pomegranate, etc, a farmer will be eligible for interest subsidised for three years to cover the average growth cycle of such crops or plantations. “Now this subvention scheme where a 13 per cent loan is given at the rate of four per cent will be available for a three-year loan and not only a short-term seasonal crop loan. However, the amount has been capped at Rs 30,000, unless there is a case approved by a bank for more amount, depending on the nature of the crop,” said a official.

Earlier this month, the Union cabinet had approved the release of Rs 10,901 crore as interest subvention for 2012-13. Of this, Rs 3,267 crore was a subvention for National Bank for Agriculture and Rural Development (Nabard) for refinance to co-operative banks and regional rural banks (RRBs) and Rs 7,634 crore to public sector banks, RRBs & co-operative banks for subvention on their own funds.