Chief minister Uddhav Thackeray on Monday wrote to Union agriculture minister Narendra Singh Tomar requesting for continuation of the 2 per cent interest subvention scheme for short-term crop loans in Maharashtra. Thackeray stated that the discontinuation of the interest subvention scheme is likely to impact 70 lakh farmers in the state.
Thackeray referred to the recent circulars of the Ministry of Agriculture and Farmers Welfare and NABARD through which the scheme has been modified stating that its benefits would not be available from the financial year 2022-23.
“This will have an adverse impact on financial position of the Cooperative Banks and in turn, it will have serious negative impact on the distribution of short term crop loan to the farmers in the State,” said Thackeray in the letter. The issue was discussed in the state-level bankers’ committee meeting on Monday and the decision to request the Union government to restore the scheme was taken.
He further said that the interest subvention scheme was specially helpful to the Cooperative Banks, which have larger connect to the farmers.
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“At present, Cooperative Banks/District Central Cooperative Banks (DCCBs) in the State are offering interest rate on deposits ranging from 3 to 7.75% p.a. These banks are also required to maintain statutory reserves e.g. CRR, SLR & other financial parameters as per RBI guidelines. Considering these factors, DCCBs in the State find it difficult to lend to farmers at 7% interest without interest subvention from the Central Government,” he added.
Thackeray further said that considering all above factors, there is an immediate need to review the decision of withdrawal of interest subvention. “I sincerely urge the Government of India that to protect the interest of farmers, the interest subvention facility which was available till the year 2021-22 may be continued further,” he added.