While announcing relief measures for farmers, Finance Minister Nirmala Sitharaman on Thursday said that 63 lakh Agriculture loans worth Rs 86,600 crore had been approved in the lockdown affected period from March 1 to 30th April, 2020. She was highlighting the steps already taken by the government amid coronavirus crisis. That amount may appear significant, especially in the midst of the extended lockdown. However, the loan disbursals are woefully short of the Centre's target for the fiscal so far.
Budget 2020 had allocated Rs 15 lakh crore towards farm credit, up 11 per cent from Rs 13.5 lakh crore in the previous fiscal. This amounts to a monthly disbursal target of Rs 1.25 lakh crore. In March-April, it should amount to Rs 2.5 lakh crore. However, the government has given only 86,600 crore. Thus, Centre's loan disbursal to the agriculture sector is currently at a run rate of one-third of target for the fiscal - clearly a cause of concern.
"Our government is committed to the goal of doubling farmers' incomes by 2022," Nirmala Sitharaman had said in the budget speech. She had also said that the prosperity of farmers could be ensured by making farming competitive. The government proposes raising the target for disbursing agriculture credit to Rs 15 lakh crore for FY21 to provide better access to bank credit, she said.
"Credit limit has been expanded. I am sure it is based on local ground-level requirements... we expect the demand to grow and credit requirements to also meet up with it. I am actually closely monitoring banks and their extension of credit facilities, particularly to rural areas. So I think we'll be able to meet that," she had said after addressing the central board of RBI a few days after the budget.
Meanwhile, the government announced Rs 2 lakh crore concessional credit boost to 2.5 crore farmers through Kisan Credit Cards. An amount that's most likely part of the Rs 15 lakh crore overall agri credit target for the fiscal. Fishermen and animal husbandry farmers will be included in the Kisan Credit Card scheme, Sitharaman said. The Finance Minister also unveiled Rs 30,000 crore additional emergency fund through NABARD for farmers.