FICCI–RURAL MARKETING SUMMIT

2005

THEME :- New Initiatives For Credit Flow In

Rural Areas

PRESENTED BY :
S K MITRA, EXECUTIVE DIRECTOR, NABARD
08 OCTOBER 2005
 PUBLIC POLICY
INITIATIVES/PRONOUNCEMENT

¾18 JUNE 2004 – Pronouncement of Hon.

Finance Minister for Doubling of
Agricultural Credit in 3 years

¾NABARD Coordinates/Monitors the

agricultural credit flow for Commercial
Banks (both public & private), RRBs,
Cooperative Banks (both SCBs/CCBs &
SCARDBs)
 POLICY INITIATIVES
¾Making ineligible farmers eligible for support from
banks
(Relief to farmers in arrears, farmers in distress,
one-time settlement, etc.)
¾Increasing credit flow growth – 30% over last
year’s disbursement
(100 new farmers per branch, 2 to 3 agrl.
Investment projects/branch, 10 Agri Clinics Agri
Business Centres per district, educational loans,
etc.)
 GROUND LEVEL CREDIT FLOW
2004-05 (RS. CRORES)

Agency Target Achievement % of Target

Com. Banks 57,000 72,886 128 %

(52,441)
RRBs 8,500 11,718 138 %
(7,581)
Coop. Banks 39,000 30,638 79 %
(26,875)
TOTAL 1,04,500 1,15,242
(86,897)

( ) represents achievement of 2003-04

GROUND LEVEL CREDIT FLOW 2004-05
(Rs.Crores)
80000
70000
60000
50000
40000 Target
30000 A c h ie ve m e n t
C o o p .B k s
37%
20000 CBs
CBs RRBs
10000 55% C o o p .B k s

0 RRBs
CBs RRBs C o o p .B k s 8%
 PROGRESS DURING 2005-06
Rs. Crores
Agency Target Disb.(Apr- Target Disb. (Apr- Growth in
Aug. (2005-06) Aug. 2005) disb. Over
2004) Aug. 2004

Comm. 57000 22639.29 87200 36304.42 60.36%

Banks (39.71%) (41.63%)

Coop. 39000 14760.44 39600 18556.03 25.72%

Banks (37.84%) (46.85%)

RRBs 8500 4537.53 15200 6603.81 45.53%

(53.38%) (43.45%)

Total 104500 41937.26 142000 61464.26 46.56%

(say 105000) (39.94%) (43.28%)
OTHER IMPORTANT INITIATIVES - 2005-06

i) Launching of National Horticultural

Mission
Doubling of horticultural production by
2011-12 to 300 million tons
(Action Plans already approved for
States like Maharashtra, Orissa, UP,
Chhatisgarh, Andhra Pradesh ,
Karnataka, Rajasthan, Tamil Nadu,
West Bengal)
.....contd..
OTHER IMPORTANT INITIATIVES - 2005-06
....contd...

ii) Credit-cum-subsidy schemes in various sectors

(cold storage, rural godowns, marketing
infrastructure, market yards, grading/packaging,
organic farming, food & agro processing, etc.
iii)Zero Cost Capital Support for Dairy & Poultry
iv) Coverage of all eligible farmers under KCC
v) Revision of scale of finance & unit cost
OTHER IMPORTANT INITIATIVES - 2005-06
....contd...

vi) Increasing thrust of micro credit support through :

- mFI & SHG-Bank Linkage

- Augmentation of mFDFD to Rs. 200 Crs.

- Rating of mFI for easier access to banks

- SHG formation and financing in 13 non-

Southern states

Banking Correspondent & ‘Business Facilitator

Models’ for Commercial Banks (Khan
Committee recommendations)
 Other Initiatives eventually
contributing to increase in credit flow
¾Creation of Rural Infrastructures like roads,
bridges, irrigation structures, etc.
¾Loans out of Rural Infrastructure
Development Fund (RIDF) with NABARD
to State Govts.
¾Grants under Rashtriya Sama Vikas Yojana
(RSVY) of Planning Commission in 150
backward dists.(Rs. 15 crores per dist. Per
year for 3 years ....contd...
 Other Initiatives eventually
contributing to increase in credit flow
...contd

¾Expansion of District Rural Industries

Project (DRIP) to another 26 districts
during 2005-06

¾Developing artisan clusters by

NABARD, UNIDO, SIDBI, DC
Handlooms, etc. ...contd..
 Other Initiatives eventually
contributing to increase in credit flow
...contd...
¾Participatory watershed
projects in dryland areas
for improving soil & water use

¾Developing private wastelands

based on agri-horti-forestry
models with proper backward
linkage support and forward
buyback arrangements
Cumulative Growth in SHG-Bank Linkage(As on 31 March)

Priority States 2002 2003 2004 2005

Assam 1,024 3,477 10,706 27,223
Bihar 3,957 8,161 16,246 21,507
Chhattisgarh 3,763 6,763 9,796 14,257
Gujarat 9,496 13,875 15,974 23,781
HP 5,069 8,875 13,228 16,158
Jharkhand 4,198 7,765 12,647 19,946
Maharashtra 19,619 28,065 38,535 55,397
MP 7,981 15,271 27,095 38,943
Orissa 20,553 42,272 77,588 1,10,364
Rajasthan 12,56 22,742 33,846 53,739
UP 33,14 53,696 79,210 1,08,315
Uttaranchal 3,323 5,853 10,908 13,117
West Bengal 1,143 32,647 51,685 77,201
Total 1,41,804 2,49,462 3,97,464 5,81,986