NABARD projects a credit potential of Rs.3.59 lakh crore for priority sector lending in Karnataka during 2023-24 which is 8% higher than the previous years’ credit projection, stated T Ramesh, Chief General Manager (CGM), NABARD during the State Credit Seminar organized by them in Bangalore today, wherein the State Focus Paper 2023-24 was released by S N Prasad, IAS, Additional Chief Secretary and Development Commissioner, Government of Karnataka in the presence of Smt Shalini Rajneesh, IAS, ACS, Planning Programme Monitoring and Statistics, Dr. M V Venkatesh, Commissioner, Watershed Development Department, Smt. Sunanda Batra, GM, RBI, Debananda Sahoo, CGM, Canara Bank and A Muralikrishna, GM, SLBC Convener.
NABARD prepares Potential Linked Credit Plan (PLP) annually for each district through a consultative process for credit planning and dispensation for priority sector activities. The PLPs map the potential available for Priority Sector lending taking into consideration the available resources, scope of economic activities, trends in credit deployment, infrastructure needs, market opportunities, etc. The sector-specific potentials assessed through the district plans are aggregated at the State level in the form of “State Focus Paper (SFP)”. Apart from the sectoral credit potentials, the State Focus Paper also identifies the critical infrastructure gaps, other linkage support and key policy issues requiring appropriate interventions from various stakeholders for the holistic development of agricultural and rural economy of the state.
Speaking on the occasion, I S N Prasad, IAS, ACS & DC indicated that since two third of the cultivable area in the State is rainfed and drought prone, the state has always been adopting a multi pronged approach to create irrigation infrastructure, giving equal focus for major, medium, minor and micro irrigation projects. This well planned investments by the State Government for rural infrastructure creation, coupled with good banking network, have paved way for improved rural economic activities and thereby increasing the ground level credit flow over a period of time.
While briefing about the development schemes formulated by the State Government, he laid emphasis on the digital interventions like BHOOMI, KAVERI, FRUITS etc. He appreciated NABARD for its contribution in development of the State of Karnataka and expressed hope that the State Focus Paper will serve as a useful document in channelizing credit and highlighting the Focus Area towards Sustainable and Inclusive growth.
T. Ramesh, CGM, NABARD informed that out of the total estimated credit potential of Rs.3.59 lakh crore in the state for the year 2023-24 under the Priority Sector, the share of agriculture sector including agri infrastructure and ancillary activities is Rs.1.79 lakh cr (50%), MSME sector is Rs.1.35 lakh crore (38%) and other priority sector is Rs.0.45 lakh cr (12%).
Keeping in view the Central and State Governments’ priorities for accelerating and sustaining the agricultural growth and enhancing Farmers’ Income by creating market-led farm enterprises and job opportunities at local level, special thrust in the credit projections has been given on Capital Formation in agriculture and allied activities, sustaining and increasing productivity in agriculture, facilitating food and agro processing activities, MSME and informal credit delivery systems (SHGs/JLGs).
CGM, NABARD indicated that the ground level credit flow during 2021-22 was slightly muted which was mainly due to the low offtake of credit, as an aftermath of the pandemic and the consequent restructuring of agri loans that restricted farmers from availing fresh credit, also multiplied with technical issues in data capturing in the revamped GLC portal. However, he expressed optimism in banks achieving the ground level credit flow target and even surpassing it during the current financial year, as 43 % of the target has already been achieved by 30 September 2022.
He also highlighted on the initiatives taken by NABARD in the recent past for fostering multidimensional growth in the State’s economy. NABARD is working towards strengthening Rural Financial institution (RFI). To bring in efficiency, accountability and transparency at Primary Agricultural Co-operative Societies and improve profitability, Centrally Sponsored Project for Computerisation of PACS has been launched by Government of India through implementation of common accounting system and MIS and NABARD has been entrusted with the responsibility of implementing the project across the country. In Karnataka, 5491 PACS have been identified in the first phase for computerization which is expected to facilitate the small and marginal farmers, easier access to banking services.
NABARD has also initiated a pilot on integration of proposed eKCC portal with FRUITS portal of State Govt. to ensure timely and hassle free credit dispensation to farmers. A pilot project on digitization of agri value chain financing is also being implemented by NABARD involving an agri start up, public sector bank and an FPO in Tumkur district of the State.
With an objective to bring water security for the small and marginal farmers in the arid and semi arid regions of North Karnataka, NABARD through the unique project on water conservation through construction of farm ponds by Joint liability groups (JLGs), entered into MoU with two leading banks, SBI & HDFC bank to ensure collateral free credit to these JLGs which has brought enhanced income to farmers.
He urged the bankers to put their best efforts in successful implementation of credit plan for channelizing the credit to priority sector. He added that some of the major initiatives like infrastructure creation leading to capital formation in agriculture is being facilitated through Rural Infrastructure Development Fund, Agriculture Infrastructure fund etc., which could be strategically leveraged for accelerating growth in investment credit in the State. Various other interventions like watershed development, tribal development, promotion of Farmer Producer Organisations, fostering credit linkages through SHG/JLG etc., being undertaken by NABARD can open up avenues for the bankers in increased credit dispensation in the State.
Smt Shalini Rajneesh, IAS, ACS, Planning Programme Monitoring and Statistics emphasized on having brick and mortar branches in the uncovered 54 villages in Karnataka. She indicated that 88% women enterprises have been set up with own funds as they lack assets/collaterals and urged the bankers to support such enterprises. She also expressed concern on the low level of take off under PMAY and PMKSY with bank linkage.
Dr M V Venkatesh, IAS indicated that Govt of Karnataka has brought out Land Resource Inventory (LRI) covering 14 lakh ha, which can be utilized for strategizing climate resilient activities in agriculture. He urged the bankers to support units under PMFME scheme and FPOs.
Smt. Sunanda Batra GM, RBI appreciated the efforts of NABARD in the area of financial inclusion and financial literacy and urged the bankers to conduct more programmes on digital and financial awareness. She sought support of all stakeholders in development of model farms in each village of the State with electronic display boards showing price and non price information. CGM of Canara Bank and GM, SLBC convener complimented the efforts of NABARD in preparing the PLPs for Districts and aggregating to SFP and placed on record that the projections shall be accounted while preparing the Annual Credit Plan for the Districts for the year 2023-24.