Chidambaram upbeat on farm credit targets

Our Economy Bureau
19 January 2005

Hyderabad: Finance minister P Chidambaram has said the government was confident of surpassing the targets fixed for credit disbursal to the agriculture sector.

Addressing a meet organised by Andhra Bank here on Monday, Chidambaram said the government was committed to enhancing rural credit to the farming community, besides enabling women, senior citizens and students to get easier access to credit and insurance linked credit and deposit products.

Chidambaram said agricultural credit was expected to exceed the target of Rs1,05,000 crore set by the Government for 2004-05 compared to an agricultural credit of Rs80,000 crore during the last fiscal. In Andhra Pradesh alone, banks have advanced Rs7,010 crore as agricultural credit so far this year and the targets will exceed this.

According to the minister, of the 10 crore farmer-families in the country currently, only four crore had access to formal credit from banks or co-operative societies, while the rest depended on local moneylenders. The government has embarked upon an ambitious programme to bring all farmers of the country under the formal credit system and relieve them from the clutches of moneylenders.

"Each year, we plan to add 50 lakh farmers to the formal credit system. The idea is to meet the needs of all farmers through the system in the next few years," Chidambaram said.

On the targets for self-help groups (SHGs), Chidambaram said groups run by women would get top priority. The government has, so far, provided loans to 10.8 lakh SHGs and proposes to help another 1.8 lakh SHGs this year. The women SHGs had a 98 per cent repayment record, he added.