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entrepreneurs, by facilitating entrepreneurial development as well as supporting
establishment of new enterprises, and above all, by providing refinancing
facilities in respect of bank loans for industrial activities (manufacturing and
processing) in small, tiny, collage and village industries. The refinance facilities
for the non-farm sector have been sizeable as shown below (Table 5.24):
Based on these refinance support and, more importantly on their own,
the various credit agencies have been rendering ground-level assistance to
the non-farm sector enterprises. The institutional credit expansion for the
non-farm sector, as reported by NABARD, has thus been taking place at a
decent rate of 15 to 20% in each of the past few years. But, the GLC for the
agricultural sector has been growing at a still faster rate. As a result, the non-
farm sector GLC as a proportion of agriculture GLC has been receding in
these years (Table 5.25).
Table 5.25: Ground-Level Credit (GLC) Disbursements for Non-Farm Sector
Year
GLC for Non-Farm
Sector
Aggregate GLC for
Agriculture
Non-Farm Sector as Percentage
of Aggregate Agriculture GLC
(1)
(2)
(3)
(4)
2001-02
16,282
62,045
26.2
2002-03
17,788 (+10.7)
69,560 (+12.1)
25.6
2003-04
20,887 (+17.4)
86,981 (+25.0)
24.0
2004-05
25,042 (+19.9)
125,309 (+44.1)
20.0
2005-06
28,803 (+15.0)
149,286 (+19.1)
19.3
Source:
Special tabulations made available by NABARD for the project. Not available beyond 2005-06.
Regional disparities in non-farm GLC
It is found that regional disparities in the distribution of GLC for the
non-farm sector are truly acute. About 48% of non-farm loans are disbursed in
the southern region alone. With another 24% disbursed in the northern region,
about 72% of non-farm sector loans are purveyed by banks in the two regions
of south and north (Table 5.23); these two regions together account for just
32% of the country’s population or 35% of the rural population or 42% of the
urban population.
Interestingly, the regional disparities in the distribution of non-farmGLC
are much more acute as compared with the distribution of agriculture GLC
(Table 5.27). While about 34%-35% of GLC for are absorbed by the southern
region, the region absorbs 47%-50% of GLC for non-farm sectors. a per the
recent trends, only a fractional deadline in the share of the southern region has
occurred but interestingly, again it has moved in favour of the northern region.
