Annual Report 2009-2010 - Department of Agriculture & Co-operation

needs of farmers. Some of the important
measures initiated in this regard are as under:
In order to improve the flow of credit and
mitigate the distress of farmers due to
the problem of indebtedness, the
Government of India announced a special
farm credit package on 18 June 2004. The
package, inter alia, envisaged that credit
to the agriculture sector would double in
the next three years.
Banks have been advised to simplify the
procedure for documentation required to
secure agricultural loans.
To improve outreach among the poor and
the informal sector, the SHG-bank linkage
programme was intensified. Banks have
also been advised to finance Joint Liability
Groups and Tenant Farmers' Groups.
As part of the measures announced by the
Reserve Bank of India (RBI) for financial
inclusion, banks have been advised to
open 'No Frills' accounts and issue simple
overdraft facilities against such accounts.
Banks have also been advised to issue
General Credit Cards with limits up to Rs.
25,000 without insisting on security and
end use of funds.
Banks have been advised to undertake,
on a pilot basis, 100 per cent financial
inclusion in at least one district in each
state. Based on the success of the pilot,
the State-Level Bankers Committee in the
states will draw a time-bound plan for
achieving 100 per cent financial inclusion
in other districts of the states.
8.4 Revival Package For Short-Term
Cooperative Credit Structure: In pursuance of
recommendations made by the Vaidyanathan
Committee Task Force, the Government of India
had approved a Revival Package for Short-Term
Cooperative Credit Structure (STCCS) aimed at
making it a well managed and vibrant structure
to best serve the credit needs of rural India. The
revival package envisages an outlay of Rs. 13,597
crore for recapitalisation of STCCS, capacity
building , training, and computerisation, subject
to legal reforms by the state governments. The
revival package seeks to i) provide financial
assistance to bring the system to an acceptable
level of health; ii) introduce legal and institutional
reforms necessary for their democratic, selfreliant
and efficient functioning; and iii) take
measures to improve the quality of management
as an integrated package. So far, 25 States,
namely, Andhra Pradesh, Arunachal Pradesh,
Assam, Bihar, Chhattisgarh, Gujarat, Haryana,
Jammu and Kashmir, Jharkhand, Karnataka,
Madhya Pradesh, Maharashtra, Manipur,
Meghalaya, Mizoram, Nagaland, Rajasthan,
Orissa, Punjab, Sikkim, Tamil Nadu, Tripura,
Uttarakhand, Uttar Pradesh, and West Bengal,
have signed a Memorandum of Understanding
(MoU) with the Government of India and
NABARD. These states cumulatively cover 96 per
cent of the STCCS units in the country. An amount
of Rs. 7,051.75 crore has been released by
NABARD as the Government of India's share for
recapitalisation of 37,303 PACS in 10 states as
on 31 December, 2009.
8.5 Kisan Credit Card: Banks are issuing
Kisan Credit Cards (KCCs) to farmers for providing
adequate and timely support from the banking
system for their cultivation needs, including the
purchase of all inputs in a flexible and cost
effective manner. About 878 lakh KCCs have
been issued up to November 2009. Ownership
of a KCC enables sanctioning of loans for the
short, medium, and long term, and a reasonable
component of consumption credit within the
overall limit sanctioned to the borrowers.
8.6 Banks have been advised to provide
active KCCs to all eligible and willing farmers in
a time-bound manner.
Agricultural Credit and Crop Insurance
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