More subvention of interest for farmers

Finance Minister Pranab Mukherjee while presenting the Budget 2009-10 in Lok Sabha on Monday stated that the target for the agriculture credit flow for the year 2009-10 is being set at Rs 3,25,000 crore. Agricuture credit flow for the year 2008-09 was Rs 2,87,000 crore.

To achieve this, Mukherjee proposed to continue the interest subvention scheme for short term crop loans to farmers for loans up to Rs 3 lakh per farmer at the interest rate of 7 per cent per annum.

He also announced an additional subvention of 1 per cent as an incentive to those farmers who pay their short term crop loans on schedule. The interest rate for these farmers could come down to 6 per cent per annum.

An additional budget provision of Rs 411 crore over interim Budget has been earmarked for the purpose. -- PIB