Finance Minister P. Chidambaram has announced that public sector banks could exceed the agricultural loans target set for this year. The farm loans target for PSBs was set at Rs. 5.75 lakh crore for the current fiscal. The finance minister said that the banks could achieve more than the target and disburse total agri loans worth Rs. 6 lakh crore.
Finance minister also mentioned that farm loans target fixed for the current year was 20 percent more than the amount targeted last year. Last year, the banks were to achieve a farm loans target of Rs. 4.5 lakh crore, which they surpassed by Rs. 25000 crore.
At present, farm lending rates are about 7 percent, which could come down to 4 percent if farmers repay the loans properly. Of the total agricultural loans, about 60 percent would be aimed at crop loans, and the rest would be used for financing other purposes such as cold ctorage facilities, mechanization and buying tractors.
It is reported that Nabard, Indian Overseas Bank and Indian Bank have joined hands to sponsor a training centre for farmers where they will learn about other income generating sources apart from farming. In the training center, they will be trained in non-farming activities like mobile handset repairing, tailoring, sheep rearing and poultry farming.