Ballooning overdues under various agriculture and non-agriculture schemes being faced by banks are threatening to disrupt smooth credit flow to these sectors in Andhra Pradesh.

The trend has prompted banks in the State to step up their recovery efforts, especially as recovery of loans as per the terms of repayment has become essential under prudential norms.

Bankers have appealed to the State Government to support banks in this regard, proposing that the Agriculture Department initiate a step to make chronic defaulters ineligible for general incentives such as input, seed and fertiliser subsidies.

Latest statistics show the total outstanding balance in overdue accounts stood at Rs 8482 crore, which is over 24 per cent of the overall lending under the short-term agriculture crop production loans. In the total agriculture sector, total overdues have risen to Rs 13,491 crore, which is 20 per cent of the total lending in this sector.

Under the priority sector advances, the overdues have increased to Rs 19,551 crore, while in the housing sector the outstanding balance in overdue accounts is Rs 1,792 crore. “Out of the 52 banks in the State, only about 30-35 have submitted the data. Hence, the actual figures would be higher,” a banker said.

“Recently, the State Level Bankers Committee conducted a special meeting on the overdues issues in the agriculture sector and several members expressed concern that the crop loans of 2007-08 are not being repaid by farmers with the hope that these loans will be waived,” Mr R. Ramachandran pointed out at the last SLBC meeting.

For the current fiscal, the Government of India has targeted a credit flow of Rs 4.75 lakh crore to the farmers. The Centre has fixed a target of Rs 48,000 crore to Andhra Pradesh for agriculture loans.

Figures released by the State Agriculture Department indicate that the achievement by bankers under crop loans so far this fiscal is Rs 12,305 crore, as against the target of Rs 20,285 core, which works out to about 60 per cent.

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