INTEREST SUBVENTION FOR CROP LAON RELEASED BY INDIAN GOVT.

The decision, taken at a Cabinet meeting chaired by the Prime Minister Manmohan Singh, is aimed at bringing more farmers under the net of institutional credit and raising farm productivity.

The banks provide farm loans of up to Rs 3 lakh at 5-7% interest per annum and the government gives 2-4% subsidy to these banks and NABARD.

“The Cabinet today gave its approval for the release of Rs 4,868 crore as interest subvention to public sector banks, regional rural banks (RRBs), cooperative banks and NABARD for refinance to RRBs at concessional rates,” an official statement said.

Farmers take short term loans to buy seeds at the beginning of the crop cycle and are usually payable within a year. Those farmers who pay back loans within 12 month are eligible for 4% subsidy, while others get 2% subsidy.

With large number of farmers still under the trap of money lenders, the The government on 330-07-2010 decided to release Rs 4,868 crore to state-owned banks for providing short-term crop loans to farmers at a
concession of up to 4% to lending rates.
concessional loan scheme will go a long way in bringing them to institutional credit and improve farm productivity, the release said.

The government has since 2006-07 been subsidising short term crop loans. While farmers have been getting loans at a concession of two per cent in lending rates, those repaying their bank debts get 1.0% additional discount from last fiscal. This year, the amount of concession has been increased to 4.0% by the government.

For 2010-11, the target for agricultural credit flow has been raised to Rs 3,75,000 crore from Rs 3,25,000 crore in 2009-10.

NABARD WILL ADOPT 40 VILLAGES FOR HERBAL PLANTATION IN HP

The National Bank of Agriculture and Rural Development (NABARD) will adopt 40 villages in Himachal Pradesh to promote herbal plantation in the state, Chief Minister Prem Kumar Dhumal said on 30-07-2010.

NABARD has already adopted 20 villages in the state.


'NABARD would adopt 40 more villages under the Village Development Plan to give boost to herbal cultivation and to improve livelihood of the farmers,' Dhumal told reporters after meeting with senior bank officers.


'Such an initiative would supplement the income of the farmers,' he added.


The chief minister said the government last year launched a herbal plantation campaign under which the farmers were provided saplings of more than 50 indigenous species like neem, banyan, jamun and peepal free of cost for plantation.


Over one crore herbal saplings were distributed among the locals through government-monitored 525 joint forest management committees.

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