The Hindu : Provide assistance to farmers, says Sonia

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Wednesday, Sep 10, 2003

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Provide assistance to farmers, says Sonia

By Our Special Correspondent

NEW DELHI SEPT. 9. The Congress president, Sonia Gandhi, has asked the Government to take steps to provide assistance to farmers and create an environment for the "realistic execution'' of its announcements.

In a letter to the Union Agriculture Minister, Rajnath Singh, in her capacity as the Leader of the Opposition, Ms. Gandhi said that even though the NABARD amendment Bill was introduced and passed on August 18 this year, the promise of nine per cent rate of interest on loan remained "hollow.''

The NABARD Chairman had written to her stating that the amendment would not serve the purpose unless the rate of interest on General Line of Credit (GLC) by the Reserve Bank was reduced; the GLC itself was increased and the cooperative credit institutions were strengthened in line with commercial banks.

She told the Minister that the amendment was carried when it was pointed out that the cooperative banks which gave almost 40 per cent of agriculture loans could not provide it at nine per cent without reducing the number of stages through which the loan was processed.

Referring to the NABARD chairman's suggestions she said these required urgent attention since farmers needed relief on many fronts, particularly with regard to credit. Of the total bank loans, the percentage of agriculture had been declining since 1997.

The Centre and the RBI had failed to ensure that the banks achieved the stipulated target of 18 per cent of total credit for the agriculture sector.

Suggesting that community/group collateral could be accepted, Ms. Gandhi said that removal of restrictions on tenancy and leasing and accepting trees on a farmer's land as collateral were other ways to solve the problem.

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