For agricultural loans, bankers call for longer repayment period

There were also suggestions to have an agriculture credit guarantee scheme, and a stronger institutional network to prevent multiple lending in the agriculture sector.

In view of the significant stress in the agriculture sector, bankers at the state-level consultancy meet in Kolkata have called for longer repayment periods for loans under Kisan Credit Card (KCC) from 12 months to 36 or 48 months.

There were also deliberations on allowing farmers to take fresh loans even if they fail to repay the entire loan, as long as they service the interest.

Based on direction from the department of financial services, public sector banks started a three-stage consultation process last week.

They focused on nine issues, including digital banking, credit to micro, small and medium enterprises (MSMEs), and agriculture sectors, direct transfer of benefits as well as education loans, among other issues.

This month has seen intra-bank as well as inter-bank meetings to discuss key issues. The final set of suggestions from all the meetings will be sent to the Centre, which will organise a meeting with banks in the first week of September.

“Stress in the agriculture sector is touching double digits and is a phenomenon visible across the banking sector. Bankers are really concerned about the issue,” said Ashok Kumar Pradhan, managing director and chief executive officer (MD & CEO) of United Bank of India, at a press meet in Kolkata last week.

There were also suggestions to have an agriculture credit guarantee scheme, and a stronger institutional network to prevent multiple lending in the agriculture sector.

Some of the suggestions at the branch level also included the need to press the government for digitisation of land records, failing which there had been instances of multiple borrowings.

At the branch-level meet, Rajnish Kumar, chairman, State Bank of India, too, stressed the need to revamp agriculture and MSME lending practices, given the high stress in these sectors.

Bankers have also suggested the need to have a credit guarantee mechanism for the Pradhan Mantri Mudra Yojana (PMMY), the government’s flagship credit scheme for micro and small enterprises. It is another source for a big chunk of the non-performing assets or NPAs.

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Devendra Fadnavis' drought-free Maharashtra plan by 2019 comes a cropper

Second part of the series maps how over 40% talukas in the state still face water crisis.

In April 2016, Maharashtra operated the water train to supply drinking water to drought-affected Latur.

In the same year, the state embarked on its Jalyukt Shivar Abhiyan to become drought free by 2019. Despite the ambitious plan, 40 per cent of the state is reeling from drought and its water tanker economy is booming. Jalyukt Shivar Abhiyan aimed at making Maharashtra a drought-free state by deepening and widening streams as well as constructing cement and earthen stop dams, nullahs and digging farm ponds.

But, as of February 2019, the state government declared drought in 151 of the 358 talukas. In these talukas, 28,524 villages have been declared drought affected. Of this, 112 are severe drought hit. While activists say that the Jalyukt scheme has failed after a spectacular start, government officials defend their work, claiming the last monsoon rainfall was at a historical low. According to Central Water Commission (CWC) data, reservoir storage during the current year has been less than the storage last year for the western region, which includes the states of Gujarat and Maharashtra. “It is also less than the average storage in the last 10 years of the corresponding period,” the commission’s report suggested. Of the 19 reservoirs that the CWC monitors in Maharashtra, five were recorded as completely dry on May 23. Between FY17 and FY20, the state budget allocated Rs 5,200 crore towards the Abhiyan. Eknath Dawale, secretary, water conservation and employment guarantee scheme (EGS), said the total expenditure for the scheme from various sources stands at Rs 8,000 crore.

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Despite the allocation, 40 per cent of the state is now struggling to get access to water for basic needs. The shortage has brought to fore the conflicts yet again. Earlier this month, the local media reported that a first information report (FIR) was filed for water theft from a residential over-head tank in Maharashtra’s Manmad district.

“The scheme started on a good note. Had they (officials) maintained the momentum, it would have worked. However, what started as a community work-driven scheme, got converted into a contractor-driven one, and the decline started,” said Rajendra Singh, water conservationist who is also known as waterman.

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