Allahabad Bank Geared for Higher Growth in Agriculture Credit during 2005-06

Allahabad Bank has pushed through Agri-Banking as the core activity in rural areas for stepping up credit flow to agriculture during 2004-05. Fresh agriculture loans of around Rs.2200 crore have been disbursed during 2004-05 far exceeding the target Rs.1102 crore allocated to the Bank by the Government of India. Share of agriculture credit to Net Bank Credit has reached 20 % against the norm of 18% New Farmers as well as those in arrears and distress have been provided loans through our Kisan Credit-cum-Kisan Shakti Card, which has become very popular amongst the farmers for hassle free coverage of their production, investment and consumption credit needs.

Shri O.N. Singh, Chairman & Managing Director, while briefing the press on the performance of the Bank in agriculture credit, mentioned that more vigorous efforts with pro active steps will be made during 2005-06 to achieve higher growth in agriculture credit supply to farmers over the achievement made in 2004-05. As a part of this planning process, Annual Credit Plans (ACPs) in 17 Lead Districts of the Bank have been finalized well ahead of the closure of 2004-05 duly approved by the District Consultative Committees (DCCs). These plans have been launched on 1st April in 17 Lead Districts of the Bank in Uttar Pradesh, Madhya Pradesh, West Bengal and Jharkhand. The aggregate plan of the 17 lead districts has been projected at Rs.2432 crore with a growth of 47.25% over the achievement made in 2004-05.The credit outlay for agriculture sector is Rs.1623 crore constituting 67 % of the total credit plan. On the very 1st day of the financial year 2005-06, 8000 borrowers have been sanctioned loans of more than Rs.70 crore by the Branches of Allahabad bank in these 17 districts marking real sense launching of the plan.

Shri Singh also mentioned that Allahabad Bank has laid emphasis on providing support services and capacity building of the farmers specially belonging to small/marginal/tenant groups and other entrepreneurs in rural areas. This would ensure demand driven credit supply for improving productivity/diversification of agriculture and employment generation. In this direction, the Bank has planned to set up Farmers' and Entrepreneurship Development Institute in East, West & Central U.P., West Bengal and other states of the country. These Institutes will become hubs for training as well as credit linkage integrated with backward and forward infrastructures. The Bank is in the process of tie up arrangements with various organizations like Krishi Vigyan Kendra (KVK), Agri. Research Institutes, Agril. Universities, District Industries Centres, SISI etc. to provide more and more technical knowledge to the farmers and entrepreneurs for their capacity building. The Bank has formed a Rural Development Trust to monitor opening and functioning of these Institutes. It may be mentioned in this connection that the Bank is already running Birsa Munda Institute of Entrepreneurship Development in Jharkhand successfully since the year 2001.

Farm Information System has become very vital to farmers for taking up profitable agriculture activities. To provide this support service to farmers, Bank has already installed one onsite rural kiosk at Sidhauli branch and another offsite kiosk in a village of Sitapur district. These kiosks have created a lot of enthusiasm and business interest amongst the farmers in that area. Another 50 rural kiosks will be installed during 2005-06 in various agriculturally developed centers of the country.

Shri Singh also added that financing of non-traditional activities such as floriculture, medicinal plants, bio-diesel plants (Zatropha) etc. and mid segment agriculture activities will be given priority. In this regard, the Bank has engaged Agricultural Finance Corporation to formulate area based agricultural projects and identify intending farmers to implement such schemes in Bahraich and Jalaun districts in Uttar Pradesh, Deoghar in Jharkhand and Midnapore (East) in West Bengal to start with. The Corporation has prepared the bankable agricultural loan projects for the districts of Bahraich and Jalaun in U.P. amounting to Rs.3.50 crore which will be financed shortly.

Incidentally, Shri Singh mentioned that in order to strengthen the functioning of the Regional Rural Banks (RRBs) sponsored by Allahabad Bank, a proposal has already been submitted to the Government of India for amalgamation of 6 RRBs namely Bhagirath, Sarayu, Sravasti, Chhatrasal, Tulsi and Vindhyavasini Gramin Banks operating in the state of Uttar Pradesh into a single large Rural Bank which will be financially strong, competitive with improved economies of scale for operations.