Delhi: The Indian government has announced a reduction
of interest rates on crop loans of up to Rs 50,000 to
9 per cent from the current 14-18 per cent per year.
addition, instructions have been issued to the National
Bank for Agriculture and Rural Development (NABARD) to
directly refinance district central cooperative banks
(DCCBs) so that their lending rates too come down to 9
Finance Minister Jaswant Singh says he has also followed
up on his Budget promise to make agricultural credit available
through post offices and a pilot project for this will
be launched in Tamil Nadu from 1 September. "Based
on the experience gathered, the scheme will subsequently
be expanded to other states."
another of his Budget promise, of providing loans for
tractors and agricultural machinery on terms similar to
loans for motor cars, a consortium led by State Bank of
India has been set up to negotiate with manufacturers
and dealers of tractors and other equipment to obtain
the maximum possible discounts and concessions.
Agriculture Minister Rajnath Singh released a statement
saying the reduction in interest rates on agricultural
loans will benefit farmers to the extent of Rs 2,500 crore
in the current year and the benefit is likely to go up
to Rs 7,000 crore by 2006-07.