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State govt seeks hike in NABARD sanction limit


OST Bureau
Bhubaneswar, Oct 25:

The Odisha government has urged the National Bank for Agriculture and Rural Development (NABARD) to hike the sanction limit of the State Cooperative Bank (OSCB).

The government’s request comes after it asked the Odisha State Cooperative Banks (OSEBs) to finance Rs 7120 crore to the cyclone and flood-hit farmers.

In a letter to NABARD chairperson Snehalata Srivastav, chief secretary JK Mohapatra has stated that the state government is trying to help the disaster-hit farmers through an ambitious Rabi programme that would cover 31.50 lakh hectares of land with a target of producing 37 lakh tonnes of crop.

As per NABARD’s refinance policy, 55 per cent of the disbursement of crop loans is at the ground level and the cooperative banks are eligible for refinance from them.

As against the programme of financing of Rs 7120 crore by the cooperative banks, NABARD has sanctioned Rs 3025 crore till date.

The chief secretary has urged the NABARD to sanction an additional limit of Rs 875 crore in favour of the OSCB to enable the latter to cope with the increasing demand of farmers in the post-cyclone and flood situation.

During the current fiscal, the cooperative banks have extended crop loans of Rs 3620 crore during Kharif whereas the commercial banks, including the Regional Rural Banks (RRBs) have provided only Rs 1605 crore which is around 30 per cent of the target given to them.

In a recent high-level meeting presided over by additional chief secretary, Finance, UN Behera, the performance of all banks was reviewed.

The meeting took note of the role played by the commercial banks in financing agricultural sector.

Even, notices have been issued by the Finance department to several commercial banks threatening to withdraw the deposits of the state government and its PSUs because of their non-performance.

A total of 17 Central Cooperative Banks in the middle rung and 2,714 Primary Agricultural Cooperative Societies (PACs) have been catering to the credit requirement of farmers to the tune of 65 per cent of the crop loans disbursed by all the banks.

Since the cooperatives have only 4 percent of market share or only 4 per cent of the deposits mobilised by all banks in the state, they have to depend upon refinance from the NABARD to meet the increasing credit requirement of farmers.