Chief minister N Kiran Kumar Reddy on Friday said interest on farm loans would will be directly credited to banks by the state government with effect from the current kharif season.
The government last year had announced total interest subvention on loans to farmers who repay on time. While the government reimbursed the interest paid by farmers last year, it would be directly credited to the banks on behalf of the farmers from this year onwards, according to the chief minister.
The banks have targeted to lend Rs 52,972 crore to the agriculture sector, both crop and term loans, in the current year, according to the annual credit plan prepared by the state-level bankers' committee (SLBC).
Addressing the SLBC meeting, Reddy asked the bankers to step up lending to allied activities as they provided supplementary income to the farmers.
Total advances and deposits during the fist quarter in the state posted an incremental increase of 5.07 per cent and 5.23 per cent respectively while the incremental credit deposit ratio stood at 118 per cent during the quarter.
Andhra Bank chairman and managing director BA Prabhakar, who is president of the SLBC, said the near double CD ratio as compared with the minimum prescribed 60 per cent in the state called for a higher emphasis on resource mobilisation, especially in untapped rural, simi-urban areas.
Solar power policy soon
Finance minister Anam Ramanarayana Reddy urged the bankers at the meeting to finance solar power projects in the state. Bankers have been reluctant to fund solar projects owing to lack of clarity in government policies. The finance minister said the government would soon come out with a clear policy framework to promote solar energy in a big way.