Banks urge farmers to sow less water-dependent crops
Public sector banks have directed their financial literacy and credit counselling centres (FLCCs) in rural areas to reach out to farmers, and provide them all kinds of support including training and counseling. Besides, all banks have been instructed to provide them credit according to their requirements.business Updated: Apr 23, 2015 23:20 IST
Public sector banks have directed their financial literacy and credit counselling centres (FLCCs) in rural areas to reach out to farmers, and provide them all kinds of support including training and counseling. Besides, all banks have been instructed to provide them credit according to their requirements.
Banks, meanwhile, have asked these centres to guide and urge farmers to sow crops, that require less care and irrigation, to control damages in case of a deficient monsoon. The finance ministry is keeping a close watch on the situation and is likely to seek reports from banks on the issue.
While the India Meteorological Department (IMD) on Wednesday predicted sub-normal rainfall this year, a farmer from Rajasthan committed suicide at an Aam Aadmi Party rally, raising fresh controversies.
TM Bhasin, chairman, Indian Banks' Association, said all banks have been instructed to carry on normal lending pattern to farmers, even if they are unable to repay their dues for the Rabi crops.
"Banks have been instructed to keep providing credit to farmers irrespective of whether or not they are able to repay their existing dues. Besides, they have been told not to coax them with any repayment of dues at this point," Bhasin told HT.
There are about 2,000 such literacy centres across the country.
The agriculture lending target for 2015-16 is Rs 8.5 lakh crore.
In 2012, the Reserve Bank of India asked public sector banks to set up FLCCs directly. These centres were earlier run by trusts and societies formed for the purpose, but they functioned under the umbrella of their sponsor banks.
Recently, Prime Minister Narendra Modi announced higher compensations to farmers for crop damages, and said public sector banks and insurance companies have already been directed to provide them the required assistance.
Last year, too, India received sub-normal rains. "The other point of worry may be the water storage position, which during the current year is less than the storage position of last year," said Soumya Kanti Ghosh, chief economic adviser, State Bank of India.
First Published: Apr 23, 2015 23:18 IST