The Hindu Business Line : Rural credit

The editorial rightly points out that the present mechanism for rural credit through Nabard and its associates is inadequate to cope with the work involved in the distribution of around Rs 50,000 crore over three years.

To achieve the results intended, other agencies, starting with the Government of India and the Reserve Bank of India, need to be pro-active in their promotion of rural credit and supportive of the institutions, especially Nabard, in actual disbursements.

The Centre should take efforts for proper identification of small, marginal, landless or big farmers. It should adopt rational policy for advancing loans, that is, as per the requirements of the farmers.

It is also essential that the credit for agriculture and allied activities is provided in two or more phases on the condition that in the first phase the money has been utilised properly and for the purpose for which it was indented.

The Panchayat Raj Institutions can also be effective partners and helpmates to credit bodies in various pursuits such as deposit mobilisation, awareness creation and recovery.

C. Ramesh

Keeramangalam (TN)

Letters to the editor and contributions can be sent by e-mail to:bleditor@thehindu.co.in