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Drought-hit farmers in Andhra Pradesh can look forward to some financial help. Nabard has sanctioned Rs 717 crore for providing refinance to co-operative banks and regional rural banks in the State.
Farmers in 555 of the nearly 1,100 mandals affected by drought need fresh credit this year. The additional allocation from Nabard is essentially for supporting seasonal agricultural operations (crop loans) by these banks.
According to a release, Rs 550 crore of the allotted funds have been earmarked for co-operative banks and Rs 167 crore for rural banks. This was in addition to the existing limits of Rs 4,200 crore, including Rs 2,600 crore for cooperative and Rs 1,600 crore for rural banks.
During last year the State could absorb Rs 3,300 crore from Nabard. There is an increase in credit demand from the farmers in the State. There was also a buoyancy in the ground level credit and banks are expecting that the credit demand will increase during the ongoing rabi season.
Of the Rs 2,600-crore allotted for the present year, co-operative banks have already refinanced up to Rs 1,762 crore from Nabard. In the case of rural banks, the figure is Rs 1,080 crore against Rs 1,600 crore.
While the banks are expected to utilise the full funds this year, Nabard was geared to consider further refinance to meet their requirements. Nabard provides crop loan refinance for production credit to cooperative banks at a rate of 4 per cent and for rural banks at 4.5 per cent a year respectively.
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