Press Information Bureau

Government of India

Ministry of Finance

27-March-2012 18:24 IST

The Reserve Bank of India constituted a Committee to re-examine the existing classification and suggest revised guidelines with regard to priority sector lending classification and related issues. The Committee submitted its Report on February 21, 2012.

The Committee has reported that as per ‘Situation Assessment Survey of Farmers’ conducted as part of 59th round of National Sample Survey, more than 80 per cent of the farmer household belong to small and marginal farmers. During the last 5 years, bank loans to small and marginal farmers as percent of Adjusted Net Bank Credit (ANBC) has increased from 3.77 per cent in 2007 to 5.71 per cent in 2011. To increase the credit to small and marginal farmers, Government has taken several measures for enhancing the availability of credit to farmers including small and marginal farmers. These inter alia include interest subvention on short term crop loans and simplification of procedures to avail agricultural credit.

The Committee has recommended a sub-target for small and marginal farmers within agriculture and allied activities, equivalent to 9 per cent of Adjusted Net Bank Credit (ANBC) or Credit equivalent of Off Balance Sheet Exposure (CEOBE), whichever is higher, to be achieved in stages by 2015-16.

The Report of the Committee is placed on RBI website, seeking views/comments thereon from banks, non-bank financial institutions, etc. other institutions and members of public before finalization of revised guidelines.

This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to a question in Rajya Sabha today.

DSM/SS/Hb

 

Priority sector lending sub-target for small and marginal farmers proposed to increase credit access and be phased in. A Reserve Bank committee recommended a formal sub-target within agriculture and allied activities: equivalent to 9 percent of Adjusted Net Bank Credit or Credit Equivalent of Off Balance Sheet Exposure, whichever is higher, to be phased in by 2015-16, aiming to increase bank credit to small and marginal farmers; the report is published for stakeholder comments.