Union Cooperation Minister Amit Shah on Friday made a case for expanding the network of primary agriculture credit societies to every 'panchayat' with an aim to increase agri-finance to Rs 10 lakh crore annually through cooperatives.
Addressing a national conference on rural cooperative banks organised by his Ministry of Cooperation and the National Federation of State Cooperative Banks (NAFSCOB), he stressed on increasing the number of primary agriculture credit societies (PACS) from nearly 1 lakh to 3 lakh over the next five years.
"PACS are the soul of our agriculture credit system. Until PACS work in a good manner, our agricultural system cannot work properly. It is equally important to expand the PACS outreach," Shah said. Minister stated that there are 3 lakh panchayats in the country, while the number of PACS is about 95,000 currently, of which about 65,000 are functional.
"Still there are 2 lakh panchayats that do not have any PACS," Shah said, and exhorted senior officials of State Cooperative Banks (SCBs) and District Central Cooperative Banks (DCCBs) to set a five-year strategy in this regard. Every district cooperative bank should think how to create one single PACS in a panchayat and every state cooperative bank should monitor that strategy while NABARD should verify those strategies, the Minister said.
Shah pointed out that agriculture finance through cooperatives has been declining over the years. Nearly 65,000 functional PACS are doing agriculture finance of Rs 2 lakh crore. "There are around 13 crore PACS members of which around 5 crore members take credit. These PACS disburse about Rs 2 lakh crore credit every year.
"Suppose this gets multiplied by five, right now we have 65,000 well functioning PACS, if we can make as many as 3 lakh PACS that work well, then this Rs 2 lakh crore credit disbursal can become Rs 10 lakh crore," the Minister said. He asked SCBs and DCCBs to aim for Rs 10 lakh crore agri- finance through PACS in the cooperatives.