The Hindu Business Line : Kerala favours liberal bank credit to farmers in AEZs

THE State Government would like commercial banks to provide credit support at concessional rates to farmers in Agri Export Zones (AEZs), according to Mr K.R. Jyothilal, Director, Department of Agriculture.

Addressing a workshop on `AEZs in the State' organised here by the Regional Office of the National Bank for Agriculture and Rural Development (Nabard), Mr Jyothilal hoped that the banks would be able to provide loans at a rate not exceeding 8.25 per cent, which is a good 2 per cent higher than the Nabard refinance rate.

The State Government had also taken a decision to link all subsidies in AEZs with bank credit, he added.

AEZ was conceived with the objective of bringing farmers, exporters and the Government together on a common platform. Development of an AEZ presupposed contributing features such as expansion of area under identified crops - for instance banana, pineapple and ethnic vegetables.

An AEZ should seek to bring under its scope those activities which are either helpful or in tune with the State's core competence. There should be a convergence of initiatives by different agencies involved in the development process.

Viewed in this context, efforts of the State Government and the private industry would need to be co-ordinated.

Earlier in the day, Mr B.S. Shekhawat, Chief General Manager of the Nabard Regional Office, inaugurated the seminar. In his address, Mr Shekhawat highlighted the importance of the State's place in the country's export scenario. It has been exporting agricultural produce, particularly spices, for the last many centuries.

As far as agri-business was concerned, the State had placed itself in a better position in recent times due to early commercialisation of agriculture.

Nabard would provide a common platform for the State Government, banks, agricultural universities, the National Horticulture Board (NHB), the Agricultural Products Export Development Authority (APEDA) and other agencies for evolving strategies for expanding the State's export basket.

"If we are to double agricultural credit in the State within the next three years, we would have to think of strategies for improving production efficiency together with value addition and price realisation," Mr Shekhawat said.

Nabard would provide 100 per cent refinance to banks for extending credit to AEZ crops within an interest rate band of 5.5 per cent and 6.25 per cent.

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