Introduction:

In an eagerly anticipated move, the government is gearing up to announce a significant boost in the agricultural credit target to a whopping Rs 22-25 lakh crore for the upcoming fiscal year. Sources indicate that this step is taken to ensure that every eligible farmer has seamless access to institutional credit, marking a crucial development in the agricultural sector.

For the current fiscal year, the government has set a target of Rs 20 lakh crore in agricultural credit. Presently, farmers enjoy a two percent interest subvention on short-term agricultural loans of up to Rs 3 lakh from all financial institutions, translating to a concessional interest rate of 7 percent per annum.

Loan:

To further incentivize timely repayments, an additional interest subvention of 3 percent per annum is offered to farmers who repay on schedule. While long-term loans are available, the interest rates are aligned with market rates. Looking ahead to the 2024-25 fiscal year, there are indications of a substantial increase in the agricultural credit target to Rs 22-25 lakh crore.

The government’s renewed focus on agri-credit is evident through various campaigns aimed at identifying and including left-out eligible farmers into the credit network. A dedicated division on ‘credit’ within the agriculture ministry underscores a more focused approach towards this goal.

Target:

Data reveals that credit disbursal for agricultural and allied activities has consistently surpassed targets over the last decade. In the current fiscal year, 82 percent of the Rs 20 lakh crore agri-credit target has been achieved by December 2023. Both private and public banks have disbursed approximately Rs 16.37 lakh crore during this period.

Anticipating another successful fiscal year, sources indicate that agri-credit disbursal is likely to exceed the target once again. In the 2022-23 fiscal year, total farm credit disbursal reached Rs 21.55 lakh crore, surpassing the targeted Rs 18.50 lakh crore.

A significant step towards financial inclusion is the issuance of Kisan Credit Cards (KCC), benefiting 7.34 crore farmers, with an outstanding amount of Rs 8.85 lakh crore as of March 31, 2023. Despite these positive strides, a substantial percentage of agricultural households remain outside the institutional credit network, according to the 2019 NSS Report.

To address this gap, the government is actively working to achieve 100 percent saturation in KCC through initiatives such as the ‘Ghar Ghar KCC campaign,’ ‘Viksit Bharat Sankalp Yatra,’ and the ‘PM-JANMAN’ campaign, with a specific focus on Particularly Vulnerable Tribal Groups (PVTGs). Left-out farmers, fishermen, and tribal farmers are being targeted for KCC issuance.

In conclusion, the government’s ambitious plan to increase the agricultural credit target signifies a crucial step towards empowering farmers and fostering growth in the agricultural sector. The implementation of focused campaigns and increased credit accessibility are expected to pave the way for a more inclusive and sustainable agricultural landscape in the years to come.

Disclaimer:

The information provided in this blog is for general informational purposes only. While we strive to keep the information up-to-date and accurate, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the content contained herein. Any reliance you place on such information is strictly at your own risk.

In no event will we be liable for any loss or damage arising from the use of this blog or the information presented in it. It is advisable to verify the information from official and reliable sources and seek professional advice where necessary.

The inclusion of external links does not necessarily imply a recommendation or endorse the views expressed within them. We have no control over the nature, content, and availability of those sites. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.

Every effort is made to keep the blog up and running smoothly. However, we take no responsibility for, and will not be liable for, the blog being temporarily unavailable due to technical issues beyond our control.

This disclaimer is subject to change without notice.