The Hindu : Business : Priority sector credit absorption capacity fixed at Rs.25,653 crores

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Saturday, Jan 14, 2006

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Priority sector credit absorption capacity fixed at Rs.25,653 crores

Special Correspondent

SFP surveys infrastructure gaps and suggests areas that require credit support, budgetary allocation No perceptible change seen in secondary sector Over 50 per cent farmers in Kerala still depended on non-banking system

THIRUVANANTHAPURAM: The National Bank for Agriculture and Rural Development (NABARD) has fixed the credit absorption capacity of the priority sectors in the State at Rs.25,653.12 crores in 2006-07.

NABARD, in its State Focus Paper (SFP), fixes this sum as the credit disbursement target for the banks in the State for the next financial year. The SFP was presented and discussed at a seminar here on Friday. Top officials of all the leading commercial banks, Reserve Bank of India and development departments of the Government participated in the discussion.

NABARD prepares the SFP after analysing the growth potential and precise needs of agriculture, minor irrigation, land development, farm mechanisation, plantation and horticulture, forestry and wasteland development, animal husbandry, fisheries, rural non-farm activities, micro credit support, industries sector and service sector.

The SFP also surveys the infrastructure gaps and suggests areas that require credit support and budgetary allocation. The commercial banks and the Government rely on it to plan their development activities.

Reviewing the status of the State economy, the document says that the negative growth trend of the past several years is continuing in the farm sector. No perceptible change is seen in the secondary sector, while the contribution of the tertiary sector to the economy is steadily increasing. The SFP identifies eco-tourism, Information Technology and micro finance ventures as areas that can contribute substantially to the prosperity of the State and its people.

The loan disbursement potential, according to the SFP, comes to Rs.7,670.67 crores in seasonal agriculture operations. The total loan potential in the primary sector that includes all the above areas is estimated at Rs.9,501.97 crores.

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