US$200 Million World Bank credit for Indian agriculture
New Delhi, Apr 19 (UNI) The World Bank has approved two credits totalling 200 million US dollars for the National Agricultural Innovation Project to help India make its agriculture sector more market-oriented with an aim to alleviating poverty and generating more income.
The credits from the International Development Association (IDA), the World Bank's concessionary arm, have 40 years to maturity with a 10-year grace period.
One of the credits (for 140 million dollars) carries a three per cent annual interest rate, the other (for 60 million dollars) carries a service charge of 0.75 per cent per annum, a World Bank press release from Washington said today.
The project will support the development and implementation of agricultural innovations through collaboration among farmers, private sector, civil society, and public sector organizations.
It responds to the goals addressed in India's National Policy on Agriculture (NPA) and the Tenth Five-Year Plan, which place high priority on raising agricultural productivity as a means to achieving agricultural growth and reducing rural poverty.
According to Michael Carter, World Bank Country Director for India, market-driven agricultural development is critical for generating additional income and employment for the more than 200 million rural poor people who depend upon agriculture for their livelihoods.
''This will help increase producer incomes, employment opportunities and wages, and ultimately reduce poverty,'' he said.
According to the World Bank, the Indian agriculture sector has undergone considerable changes in the past ten years. National food self-sufficiency has been achieved and the market demand for products such as fruits, vegetables, meat, eggs, fish, milk, sugar, and edible oils has increased and is encouraging diversification of production.
While agricultural development has long been supply oriented, its future will be more market driven.
At the same time, analyses show that with the limited scope for area expansion, enhanced productivity, profitability, and competitiveness will be the main sources of future agricultural growth. The challenge for Indian agriculture now becomes to increase profitability, competitiveness, and income earning capacity in a market driven system.
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