Special relief package to farmers

LOK SABHA

In consultation with the Reserve Bank of India and National Bank for Agriculture and Rural Development, the Government has initiated several measures for providing timely and adequate credit facilities to the farmers at a reasonable rate of interest. Some of the important measures are as under:

-Effective from Kharif 2006-07, the Government has lowered the interest rates on crop loans to 7% with an upper limit of RS. 3 lakhs on the principal amount .

-Loans upto Rs.50,000/- have been made collateral and margin free.

-Banks have been advised to simplify the procedure for documentation for agriculture loans.

-A scheme of debt waiver and debt relief for farmers has been implemented by the Government under which an estimated amount of Rs. 65,318.33 crore has been provided as debt waiver/ relief to about 3.68 crore farmers.

-In order to revive the short term rural cooperative credit institutions, a package of measures as recommended by the Vaidyanathan Committee with estimated financial outlay of Rs.13,596 crore is under implantation.

As per the report on “Indebtness of Farmer Households” released by the National Sample Survey Organisation in May,2005, 57.7% of outstanding loan of indebted farmers was sourced from formal/institutional sources consisting of banks, cooperative society and the Government .

This information was given in written reply to a question in the Lok Sabha today by Prof. K.V. Thomas, Minister of State for Agriculture, Consumer Affairs, Food and Public Distribution.

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MP/MR