The State government is exploring the possibility of restructuring the scale of finance (SoF) for crops in a scientific manner. The SoF forms the basis for determining the credit for various crops.
The State Agricultural Prices Board (SAPB) on Wednesday organised a consultative meet attended by banks, officials of the National Bank for Agriculture and Rural Development (NABARD), the State Agriculture department and farmers to discuss the current guidelines and how best the SoF can be redesigned to reflect the cost of cultivation borne by farmers.
The move assumes significance since credit limits under Kisan Credit Card (KCC) and crop insurance are fixed on the basis of the SoF.
Corrections needed
Agriculture Minister P. Prasad, who inaugurated the meeting, said the present method of determining the SoF had shortcomings and needed corrections. States like Assam, Haryana and Tripura had effective systems in place and Kerala could learn from their experiences, he said. Reviewing the SoF was also important in the light of the climate-change-induced vagaries affecting the farm sector of the State, he said.
SAPB chairman P. Rajasekharan said the consultative meet was aimed at debating whether changes were needed in the present system of fixing the SoF, and, if yes, how best it could be done in a manner acceptable to both the farmers and the banks. Also, what were the steps to be taken by the Agriculture department in this regard.
Compensation claims
Experts from the banking sector said a scientific SoF was essential for the State’s agricultural sector. Overfinancing and insufficient financing affected repayment of loans. Inadequacies in the SoF also affected the compensation claims of farmers in times of crop loss, they said. Experts also called for a common format for fixing the SoF and crop and area-specific uniformity.
K.C. Sahadevan, CEO (in-charge), Kerala Bank; Jayarani L.S., secretary, SAPB; officials of NABARD, State Bank of India, State-Level Bankers’ Committee and Kerala Agricultural University spoke.
