Coop banks decision to restrict loan affects farmers: Forum

Pudukkottai, Tamil Nadu, Aug 17 (UNI) Pudukkottai District unit of the Farmers Forum of India today said restriction in sanction of loans by Primary Agricultural Cooperative Banks has affected the farmers, especially small and marginal farmers cultivating paddy, maize and sugarcane.

In a statement here, Chairman of Farmers' Forum of India, G S Dhanapathy said the banks had introduced a fixed lending formula of Rs 10,000 to a farmer, irrespective of the exact area of crop under cultivation. The quantum of loan was inadequate to meet the cultivation cost, he added.

Mr Dhanapathy said a paddy grower cultivating the crop on five acre was eligible for a loan of Rs 40,000 at the rate of Rs 8,000 an acre in irrigated lands or about Rs 30,000 at the rate of Rs 6,000 in non-irrigated areas. But, the current 'ceiling' on credit made the farmer eligible for only Rs 10,000, he added.

The Chairman also pointed out that the cost of cultivation was far higher and urged the authorities to withdraw the restriction.

Maize cultivators bore the brunt of the ceiling, he added.

Officials of the Cooperative Department, when contacted, confirmed that the banks introduced the ceiling to ensure credit-flow to all farmers. Lending capability of banks would stabilise soon after the State Government reimbursed the loans and interest under the waiver scheme, they added.

UNI RV SW KN1238