MP to offer crop loan at -10% from crop year 2015-16

BHOPAL: From crop year 2015-16, the Madhya Pradesh government had decided to dole out crop loans bearing an interest rate of minus 10 per cent (-10%). About 40% of the farmers who receive crop loan are going to be eligible for this beneficial scheme.

"We have been giving crop loans at zero per cent rate of interest. Now we want to give it at -10 per cent interest rate because there is no alternative to farming. We can not grow our wheat, rice or chana in the factories," said Madhya Pradesh chief minister Shivraj Singh Chauhan.

He was speaking at the National Conference on Crop Insurance in Bhopal today. Meanwhile, Madhya Pradesh has withdrawn the bonus it used to give to farmers for paddy, wheat and maize over and above the minimum support price (MSP) as there is over production of these crops in the state.

Of about Rs 12,000 crore worth of crop loans distributed in the state, about 40 per cent is distributed through the co-operative banking system. "We will give 10 per cent subsidy to the co-operatives, when they collect 90 per cent of the loan amount given to the farmers. This will also incentivise the co-operatives for better recovery of the loans distributed," said Rajesh Rajora," principal secretary, Madhya Pradesh. While speaking to ET.