Government nod for continuation of interest subsidy for crop loans

NEW DELHI: Government today approved the continuation of interest subvention for short-term crop loans up to Rs 3 lakh to farmers at 7 per cent per annum.

Besides, the Cabinet also approved providing additional interest subvention of 3 per cent per annum to those farmers who repay on time, that is within one year of disbursement of their short-term crop loans taken during the year 2014-15, an official statement said.

For the interest subvention, government approved the release of Rs 18,583 crore as interest subvention for 2014-15 of which Rs 4,399 crore subvention to NABARD for refinance to Cooperatives Banks and Regional Rural Banks (RRBs) and Rs 14,184 crore to Public Sector Banks, Private Sector Banks, RRBs and Cooperative Banks for subvention on their own funds.

The government also approved the interest subvention to small and marginal farmers having Kisan Credit Cards for loan against negotiable warehouse receipts for post harvest at 7 per cent per annum and it also permitted the release of Rs 321 crore, the statement added.

In another decision, the Cabinet also approved the continuation, strengthening and establishment of Krishi Vigyan Kendras (KVKs) with an outlay of Rs 5,739.56 crore.

The scheme envisages continuation of 630 KVKs established till the XI Plan and establishment of 121 new KVKs in the XII Plan to carry out its wide range of activities so as to meet the technological needs of farmers, the statement said.

This decision will help in capacity development of farmers, it added.

KVKs work as knowledge and resource centres of agricultural technology in districts and produce critical quality technology products such as seed, planting material livestock strains, fingerlings and bio-products for availability to farmers.