Banks' surpass farm credit target

Commercial banks disbursed Rs 1,16,370 crore loans to the agriculture sector in 2005-06, up 33 per cent compared with the target set by the government for the year.

Of this, the public sector banks (PSBs) disbursed Rs 91,234 crore, while the private sector banks provided Rs 25,136 crore.

The government had set a target of Rs 87,200 crore for the year as part of its efforts to double credit to the farm sector in three years beginning 2005-06.

The target, including other financial intermediaries such as co-operative and regional rural banks for the year was Rs 1,41,500 crore. The target was fixed during a meeting of chief executives of public sector banks with finance minister P Chidambaram in June 2005.

During 2005-06, public sector banks alone financed 43 lakh new farmers, issued 38 lakh kisan credit cards and financed setting up of 860 agri-clinics.

The government-owned banks also provided Rs 12,175 crore for financing 8,95,288 new investment projects in the agricultural sector.

In 2006-07, all the banks are expected to increase agricultural disbursements to Rs 1,75,000 crore, adding 50 lakh more farmers to their portfolios.

As part of the government's agenda for doubling credit to the agriculture sector, commercial banks have accorded high priority to financing agri-clinics and agri-business centres being set up by agricultural graduates.

The idea behind agri-clinics and agri-business centres is to supplement the efforts of government extension system, to make available supplementary sources of input supply and services to needy farmers and to provide gainful employment to agriculture graduates in the emerging areas in agriculture sector.

Agri-clinics are envisaged to provide expert services and advice to farmers on cropping practices, technology dissemination, crop protection from pests & diseases, market trends and prices of various crops in the markets and also clinical services for animal health.

Agribusiness centres are envisaged to provide input supply and farm equipment on hire and other services.