Govt pumps money into Nabard to boost rural liquidity, expands credit drive

Brings 25 million farmers under concessional loan scheme; experts say these measures do nothing to address basic problem of low farm prices and falling demand

Current Affairs : The administration on Thursday chose to expand extra renegotiate backing of Rs 30,000 crore to the National Bank for Agriculture and Rural Development (Nabard). This will be utilized to push liquidity through local country banks (RRBs) and co-employable organizations, and extend the continuous drive to enroll 25 million new ranchers for concessional credit as a major aspect of its Covid-19 help bundle.

These measures, state pundits, do nothing to address the principal issue of low costs and falling interest. The progression to enroll 25 million new ranchers into the current concessional credit conspire doesn’t have a timespan, while on account of extra money to Nabard, pundits asked how banks — which loan at 4.8 percent premium — would recuperate from ranchers when their agri activities have run into misfortunes?

The renegotiate for Nabard, as per Finance Minister Nirmala Sitharaman, will be well beyond the current Rs 90,000-crore renegotiate office that Nabard was to stretch out this year to RRBs and co-employable organizations for crop credit necessity of ranchers.

“To me a superior and progressively suitable way would have been to forgo existing enthusiasm on momentary harvest credits and term advances for horticulture, alongside giving states all the more financing for focal plans, as they are starving for reserves, while simultaneously guaranteeing least 10 days work under Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) every month for the provincial poor,” Ajay Vir Jakhar, director, Bharat Krishak Samaj, disclosed to Business Standard.

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