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marketing facilities, transportation, storage, etc. The role of state
governments, therefore, is of high importance in achieving the target
especially in providing suitable infrastructure/extension support for
facilitating enhanced credit flow to agriculture. Considering the colossal
importance of credit, especially institutional credit, suitable planning/
projection of the ground level credit flow need to be addressed. The
focus of the agriculture credit during the 11
th
FYP period will be a broad-
based and inclusive growth in GLC for a sustainable and technology- led
growth of the sector” (Ibid., p.908).
It is, however, perceived that corrections to these distortions cannot
be introduced entirely by resurrecting the traditional control regime for
supply-induced credit flow. The multiplicity of in-house and independent
committees appointed by the Reserve Bank of India (RBI) and National Bank
for Agriculture and Rural Development (NABARD) – a few of them cited above
- have recommended a combination of measures involving credit targets,
intensive use of micro-finance institutions (MFIs), more innovative system of
“agency banking”, and even embracing the philosophy of “financial inclusion”
so that the banks are obliged to provide banking services to all segments of
the population on an equitable basis. The authorities have responded to these
recommendations quickly and positively and directed banks to rapidly expand
credit delivery for agriculture and small and medium enterprises through
the adoption of all of those innovative measures, as emphasized by the RBI
Governor’s speech cited above.
Agriculture Credit: A Primer On Data Base
Agricultural credit is being rendered by all banking institutions:
scheduled commercial banks, regional rural banks (RRBs) and cooperative
institutions. Amongst cooperative institutions, there are diverse sources of
farm credit rendering. In the short-term credit structure, primary agricultural
societies (PACs) are the dominant ground-level institutions, which essentially
provide crop loans but which, of late, have been permitted to grant term
loans also; the bulk of their lendable resources comes from refinance from
district central cooperative banks (DCCBs). However, in addition, there are
some DCCBs which do render direct loan assistance to farmers; these have
to be combined with loans rendered by PACs. In the long-term structure, the
picture is more complex. There are state-level cooperative agriculture and
rural development banks (SCARDBs) in 20 states along with 727 primary level
banks (PCARDBs). In the balance of the small-size states, separate sections of
the state cooperative banks look after long-term credit needs.
