After a lull in the kharif season with deficient rainfall, demand for agriculture credit appears to be finally taking off.
Late rains have triggered hope for early Rabi crops pushing demand, though state-owned banks are likely to miss the target of Rs 3,25,000 crore for the current fiscal.
About 40 per cent of the total agriculture credit goes for the Rabi crops, but this fiscal it is expected to be significantly higher — for both production and investment purposes — than previous years.
In 2008-09 the credit disbursement target for banks was Rs 2,80,000 crore, of which about Rs 1 lakh crore was given to farmers for Rabi crops.
An official source also pointed out that while demand for agriculture credit remained low with deficient rainfall during the kharif sowing season, barring a few big banks, others also showed some reluctance in providing credit to farmers as fears of non payment loomed large. The government has indicated several times that the Rs 70,000 crore farm debt relief package was a one time bonanza and may not be repeated.
When contacted, MD Mallya, chairman and managing director, Bank of Baroda however said that demand for agriculture credit for the Rabi season is yet to pick up. “It will take some time before it picks up, as of now, we have not seen any major increase in demand,” he said.
Dilip Kumar Mukherjee, general secretary, All India Regional Rural Bank Employees’ Association (AIRRBEA) said that requirement and demand for agriculture credit for the pre-Rabi and Rabi season would be higher than previous years as large number of farmers would try and make up part of their loss by going in for Rabi farming.