Interest subsidy on short-term loans to farmers and ratification of a convention for intelligence-sharing on terrorism and trans-national organised crime are on the agenda of Thursday’s Cabinet meeting.
The finance ministry has proposed to continue the interest subvention scheme for short-term crop loans to farmers for loans up to Rs 3 lakh per farmer at the interest rate of 7 per cent per annum.
In addition, the farmers who repay the loan in time will get an additional subvention of 1 per cent. It would mean that the annual interest on the loan for such farmers would be six per cent.
Finance Minister Pranab Mukherjee had proposed interest subvention in his 2009 Budget speech. Now, the ministry is bringing the proposal for the cabinet’s approval to allow agriculture credit flow of Rs 3,25,000 crore in the financial year 2009-10 to public sector and cooperative banks.
The second proposal before the cabinet is ratification of a treaty between India and the six other countries for collectively combating terrorism in the region, including cooperation in intelligence-sharing. India, Bangladesh, Nepal, Sri Lanka, Bhutan, Myanmar and Thailand are signatory of the convention — the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).
The convention allows cooperation between security agencies on combating terrorism that entails intra-regional cooperation in intelligence-sharing and legal and law enforcement issues. It also involves combating financing of terrorism and prevention of illicit trafficking of narcotic drugs, psychotropic substances and precursor chemicals.
The pact has acquired an added urgency due to a spate of recent terror attacks in India, an escalation in activities of extremists and terrorists in countries like Bangladesh, Sri Lanka, Thailand, and the increasing region-wide networking among terror outfits.
The convention was signed in August 2008 in Sri Lanka.