Date:11/11/2006 URL: http://www.thehindubusinessline.com/2006/11/11/stories/2006111102680600.htm

Back Farm loan interest subvention amount used

K.R. Srivats

New Delhi , Nov. 10

Commercial banks, co-operatives and regional rural banks have up to October 31 this year claimed Rs 874 crore from the Reserve Bank of India and Nabard for providing two per cent interest relief to farmers for Kharif and Rabi 2005-06.

About Rs 1,700 crore had been placed at the disposal of RBI and Nabard for the two per cent interest subvention announced by the Government.

Banking industry sources said the commercial banks have so far claimed Rs 375 crore, co-operatives Rs 365 crore and RRBs Rs 134 crore.

In his 2006-07 Budget speech, the Finance Minister, Mr P. Chidambaram, announced some relief to the farmers who had availed themselves of crop loans from banks and primary agriculture cooperative societies for kharif and rabi 2005-06. An amount equal to two percentage points of the borrower's interest liability on the principal amount up to Rs 1,00,000 would be credited to his/her bank account before March 31, 2006.