The government has fixed the agriculture credit target of 11 lakh crore rupees for the year 2018-19 against last year’s target of 10 lakh crore rupees. In a written reply to a question in the Lok Sabha today, Minister of State for Finance Shiv Pratap Shukla said, the government fixes agriculture credit disbursement targets for the banking sector every year and banks have consistently surpassed these targets.
He said, with a view to ensuring agriculture credit at a reduced interest rate of 7 per cent per annum to farmers, the government is implementing an interest subvention scheme for short-term crop loans up to three lakh rupees. He said the scheme provides interest subvention of two per cent per annum to banks on use of their own resources. Mr Shukla said, besides, additional three per cent incentive is being given to the farmers for prompt repayment of the loan thereby reducing the effective rate of interest to four per cent.