Agriculture credit crosses Rs 20 lakh crore till Jan in FY24, sharp jump from Rs 7.3 lakh crore in 2013-14

New Delhi: The Modi government has enhanced the institutional credit into the agriculture sector sharply in the last 10 years, with banks disbursing Rs 20.39 lakh crores during the April-January period of this fiscal as against Rs 7.3 lakh crore in the entire 2013-14, according to a senior official.

In the Budget for 2023-24 fiscal, the government set an agriculture credit target at Rs 20 lakh crore.

Banks have already breached the target and the number could cross Rs 22 lakh crore this fiscal.

To ensure the availability of agriculture credit at a reduced interest rate of 7 per cent per annum to the farmers, the Union Agriculture Ministry implements an interest subvention scheme for short-term crop loans up to Rs 3 lakh.

The scheme provides interest subvention of 2 per cent per annum to banks on the use of their resources.

Moreover, an additional 3 per cent incentive is given to the farmers for prompt repayment of the loan, thereby reducing the effective rate of interest to 4 per cent.

"Institutional credit for the agriculture sector has increased from Rs 7.3 lakh crore in 2013-14 to Rs 20.39 lakh crore in 2023-24 (till January 31, 2024) for 1,268.51 lakh accounts," a senior Agriculture Ministry official said.

During the 2022-23 fiscal, the total farm credit disbursal stood at Rs 21.55 lakh crore, surpassing the target of Rs 18.50 lakh crore kept for the same period.

The benefit of concessional institutional credit through Kisan Credit Card (KCC) at 4 per cent interest per annum has also been extended to animal husbandry and fisheries farmers for meeting their short-term working capital needs.

As on March 31 last year, there were 73,470,282 operative KCC accounts with an outstanding amount of Rs 8,85,463 crore.

That apart, the government in 2019 launched PM-KISAN scheme, under which Rs 6,000 per year is being provided to eligible farmers directly into their bank accounts in three equal installments.

The scheme was launched in February 2019, but was made effective from December 2018.

"Since 2018, Rs 2.81 lakh crores have been transferred through Direct Benefit Transfer (DBT) to more than 11 crores beneficiaries (farmers) through various installments," the official said.

Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) is a central sector scheme to provide income support to all landholding farmers' families in the country to supplement their financial needs for procuring various inputs related to agriculture and allied activities as well as domestic needs.

To achieve the objective of doubling farmers' income, the Centre in the last 10 years has enhanced the minimum support price (MSP) of crops and also increased the procurement of wheat, paddy, oilseeds, and pulses.

On Wednesday while briefing about the Cabinet decisions, Union Information and Broadcasting Anurag Singh Thakur highlighted that the Modi government has spent Rs 18.39 lakh crore on the procurement of paddy, wheat, pulses, and oilseeds from farmers at MSP during the last 10 years.

This is more than 3 times of Rs 5.5 lakh crore spent by the Congress-led UPA government in their 10-year rule (2004-2014), Thakur said while asserting that the Modi government was committed to farmers' welfare and doubling their income.