With a massive Rabi crop programme in offing and the State’s cooperative banks being given a target to finance Rs7,120 crore to farmers, Chief Secretary JK Mohapatra has urged the NABARD to hike the sanction limit of the State Cooperative Bank (OSCB).
Mohapatra has sent a missive to NABARD Chairperson Snehalata Srivastava stating how the State Government is trying to help the farmers through an ambitious Rabi programme as they have suffered a big jolt due to the Phailin and the subsequent floods. The Rabi campaign would cover 31.50 lakh hectares of land with a target of producing 37 lakh tonnes of crop.
As per the NABARD’s refinance policy, 55 per cent of the disbursement of crop loans is at the ground level and the cooperative banks are eligible for refinance from them. Till date, as against the programme of financing of Rs7,120 crore by the cooperative banks, the NABARD has sanctioned Rs3,025 crore and there is a gap of Rs875 crore to be provided as NABARD refinance.
The Chief Secretary has, therefore, urged the NABARD Chairperson to sanction an additional limit of Rs875 crore in favour of the OSCB to enable the latter to cope with the increasing demand of farmers in the post-cyclone and flood situation.
As per records, Odisha has seen 76 natural calamities over a period of 100 years, but the commercial banks have been shying away from providing crop loans to farmers. Whereas the share of the commercial banks in dispensation of crop loans has increased to a level of around 83 per cent in the country as a whole, in Odisha these institutions have been providing only to the tune of 30 per cent of the crop loans.
During the current year, the cooperative banks have financed crop loans to the tune of Rs3,620 crore during Kharif whereas the commercial banks, including the RRBs, have provided only Rs1605 crore, i.e., around 30 per cent of the target given to them.
In a recent review meeting held by Additional Chief Secretary, Finance, UN Behera, the performance of all banks were reviewed and he was highly critical of the role played by the commercial banks in financing agricultural credit. Even, notices have been issued by the Department of Finance (DoF) to several commercial banks to withdraw the deposits of the State Government and its PSUs from them because of their nonperformance.
The Short Term Cooperative Credit Structure in the State comprising the OSCB at the State level, 17 Central Cooperative Banks in the middle rung and 2,714 Primary Agricultural Cooperative Societies (PACS) have been catering to the credit requirement of farmers to the tune of 65 per cent of the crop loans disbursed by all the banks.
OSCB chief and Secretary, Cooperation Bishnupada Sethi has all along been harping on more credit mobilisation as farmers are in dire straits after the double whammy of disasters. However, the cooperatives have the market share of only 4 per cent of the deposits mobilised by all banks in the State. Eventually, they have to depend upon refinance from the NABARD to meet the increasing credit requirement of farmers.
Although the State Government has been expecting higher participation of the cooperative banks to bridge the gap between the credit requirement and the finance provided by the commercial banks, non-availability of adequate resources in shape of deposits has been affecting their performances in this regard.