BENGALURU: Chief Minister Siddaramaiah appealed to Union Finance Minister Nirmala Sitharaman to direct the National Bank for Agriculture and Rural Development (NABARD) and the RBI to enhance the Short-Term Agricultural Loan limit for the year 2024-25, in the interest of farmers, and ensure normal food grain production in Karnataka.
The drastic reduction in the sanctioning loan limit to Karnataka will drastically hamper the disbursement of short-term agricultural loans, the CM stated in a memorandum submitted to the Union minister in New Delhi on Thursday. Siddaramaiah stated that the Karnataka government has set a target of disbursing short-term agricultural loans of Rs 25,000 crore to 35 lakh farmers in 2024-25.
Through the short-term cooperative credit structure during 2023-24, short-term agricultural loans of Rs 22,902 crore have been disbursed in the state. The Karnataka State Co-Operative Apex Bank Limited has requested and sent a proposal to NABARD to sanction the SAO limit of Rs 9,162 crore for 2024-25, on behalf of short-term co-operative credit structure, the CM stated.
“For 2023-24, NABARD has sanctioned SAO concessional limit of Rs 5,600 crore. For 2024-25, as against the applied limit of Rs 9,162 crore, NABARD has sanctioned SAO concessional agricultural loan limit of only Rs 2,340 crore, which is 58 per cent less compared to last year. NABARD has told us that the reason for the reduced limit this year is because the RBI has allocated less under General Line of Credit,” the CM stated.
The CM stated Karnataka has received very good monsoon rains and the farmers are demanding to enhance the disbursement of SAO loans for their agricultural co-operations. Speaking to the media in the national capital, the CM said the reduction in funding is an injustice done to farmers. The NABARD gives loans to the state at a 4.5-per cent rate of interest. In the last five years, it was always above Rs 5000 crore, but this year, it is 58 per cent less than last year’s funding.
Responding to a question, the CM said the reduction in funding was done for all the states. “The RBI and NABARD come under the Union Government, how can they express helplessness?” the CM questioned. “Is it not an injustice to farmers? BJP and JDS leaders do not speak about it,” he said. Meanwhile, speaking to the media in New Delhi, Union minister Prahlad Joshi said Siddaramaiah is making allegations against the Centre to cover up his own government’s failure.