Will rejig crop loans of drought affected areas: Maha CM

Maharashtra chief minister Prithviraj Chavan on Monday said that crop loans in the 15 drought-affected districts in the state would be restructured. "As per the existing crop loan scheme, there is zero percent interest for loans of upto Rs 1 lakh and 2 percent for loans upto Rs 3 lakh, provided that repayment is made in the stipulated period. In the drought-affected areas, farmers could not repay loans. So, the government has decided to restructure the loans after taking into consideration the principal amount and interest," Chavan told reporters after chairing a meeting of state-level bankers' committee (SLBC).

He said a total of about Rs 7,000 crore-worth loans in 11,809 villages would be restructured. "Last year, the crop loan disbursement was to the tune of Rs 25,000 crore," Chavan added. He also said that nationalised banks have been asked to provide crop loans.

Chavan said that at Monday's meeting with SLBC, government expressed concern that investment credit had declined and the percentage of crop loan had grown. SLBC was told to provide loans for drip irrigation and construction of farm ponds. Chavan also said that credit-deposit ratio had fallen in a few districts.

Financial condition of Jalna and Dhule-Nandurbar district co-operative banks had improved and they were likely to get back license soon, he said. They were among the six district co-operative banks against whom RBI had passed strictures. Chavan said banks have been asked to have one branch in villages where population is (upto) 5,000 and ultra-small bank or business correspondent for villages with population of 2,000 or less.