PLP Madurai district

Transcription

1 EXECUTIVE SUMMARY I. Theme of the PLP The basic theme of the PLP is "Accelerating the pace of capital formation in agriculture and allied sector. Over the years, while short term loans are flowing adequately, only a portion of it is going for investments in agriculture, therefore is a need to give a push for capital formation through term lending. This could be achieved by leveraging the Credit Linked Capital Subsidy Schemes (CLCSS) and other government subsidies wherever available. Further, in tune with the GOI s thrust on the promotion of Joint Farming Groups, PLP considers it as a thrust area and banks may use the JLG model to not only improve term lending but also secure their loans through collateral substitution available in this model. a. Madurai District in brief The total geographical area of is sq.km accounting for 2.88 % of the geographical area of Tamil Nadu. The average annual rainfall of the district is mm. Vaigai is the major river in the district originating in the Western Ghats. The major sources of irrigation are by way of canals and wells. The types of soil available in the district are red loam, black cotton and clay loamy soils. There are 2 revenue divisions, 13 blocks and 596 villages in the district. The district has a total population of about lakh comprising lakh males and lakh females as per 2011 census. The literacy rate in the district is 74.8 %. Madurai district possesses good infrastructure facilities and reputed educational institutions. The district is basically agrarian in nature growing major food, floriculture and horticulture crops with good scope for development of MSE sector. b. Ground Level Credit (GLC) Trends Agency wise progress in Ground level credit in the district for the last 3 years ( , & ) and targets for is shown in the following table : (Rs. crore) Purpose Achievement during the last 3 years Target Achvt. Target Achvt. Target Achvt. Target Crop loan Term loan Total agriculture NFS sector Other Priority Sector Grand Total As may be seen, the ground level credit flow has surpassed the ACP targets in all the sectors; notwithstanding the poor monsoon during the last 3 years. In the context of sub-sectoral trends, while the Crop Loans (incl. AJLs) contributed to % of the total GLC for agriculture, the term loan for agriculture which stood at Rs crore was contributed largely by sub sectors such as Plantation & Horticulture, Farm Mechanisation, Dairy Development, Land development and Minor Irrigation. MSE and Other Priority sector also recorded impressive credit flows in line with the profile of Madurai as a central location with a vibrant trading and services sector in addition to having a number of premier educational institutions. i

2 c. Key Banking benchmarks The district has a network of 44 banks with a branch network of 434 branches in addition to 182 societies and one branch of Tamilnadu Industrial Investment Corporation. All the agencies have shown considerable growth in their deposits during the period between and , except Co-operative Banks which had shown a slightly fall in the deposits. The CD ratio of all the agencies between and has been healthy and well above the 60% benchmark set by the RBI. CD Ratio was 104% (as on 31 March 2015). The district complied with the RBI stipulation in respect of all loans between & except advances to Minority and DRI loans where the achievements are below the stipulated levels of 10 % and 1% respectively. The Modified National Agricultural Insurance Scheme is being implemented in the District. In terms of GOI Guidelines, TFO Inclusion initiatives are being undertaken by various branches in the district. After the survey, 160 villages in the > 2000 population category, 62 villages in the category & 153 villages in the <1600 population category have been allotted among various service area bank branches. d. Key factors taken into account for PLP estimations a. Dependence on monsoon for irrigation and the severe stress caused during the last 2-3 years due to drought like situations. b. Severe damage to plantation and horticulture crops with coconut and mango plantations affected in large tracts due to monsoon failure. c. With growing urbanisation, focus on improving productivity to compensate shrinkage in farm lands. d. Ensuring credit flow into those areas where credit opportunities are opened up due to implementation of Watershed programmes. e. Stress on dryland crops such as minor millets, pulses, etc. f. Recognising the key role of MSME sector in the rapidly urbanising. g. Capital formation through term lending as a contributor for sustained agricultural growth. h. Encouraging aggregation of produce in the group mode through JLGs, Farmers Clubs and Producer Organisations. e. PLP Highlights The credit potential for the year has been estimated at Rs lakh as against Rs lakh during , an increase of % which has taken into account the revised priority sector guidelines of RBI and the national priorities of Government of India to scale up lending to the various sectors of the economy. An amount of Rs lakh is estimated as credit potential for agriculture credit which includes Rs lakh towards short term credit for agriculture. The credit potential for Micro, Small and Medium enterprises is estimated at Rs lakh. As per the revised priority guidelines of RBI, for the first time, credit potential for export and social infrastructure through bank credit has been estimated under the PLP and they stood at Rs and Rs lakh respectively. Keeping in view the priorities of GoI on Housing for all by, the credit potential for housing has been estimated at Rs lakh. While broadly sticking to the physical units envisaged in the Base PLP except for the new areas, upward revision of TFO projections has been necessitated on account of changes in unit costs & scales of finance, trends in credit flow, technical parameters, priority sector guidelines etc. Major constraints and suggested action points for important sub sectors are indicated below: ii

3 a. Banks may encourage Integrated farming by farmers through family farming mode through Farmers clubs, FC federations, Joint Liability Groups, Producer s Organisations etc. Cultivation of vegetables may be encouraged by all concerned. b. Banks may scale up loans for installation of pipeline systems. As recurring deficit in monsoon has depleted ground water levels, drip irrigation in every farm may be promoted on war footing. c. As Watershed programmes being implemented by NABARD opens up credit opportunities, Banks may channelize credit in the Watersheds. Drought resistant varieties of minor millets may be encouraged in the rain fed areas. d. There is a need to step up credit flow for farm mechanization in view of labour shortage plaguing farming operations in the district. Agri Engineering department may encourage the Farmers Clubs to take up custom hiring of farm implements. e. Banks may finance nurseries for fruit/vegetable crops under shade conditions. f. As dairy offers quick returns and near stable prices throughout the year, banks should encourage entrepreneurs to take up the activity as also encourage fodder cultivation. II. Area Based Scheme on Dairy development Considering the potential of Dairying sector to blossom under integrated development, an Area Development Scheme for Integrated Dairy development in select blocks of the district has been suggested with a total TFO outlay of Rs lakh and a banking Plan has been prepared for use by the banks for wide replication. The Scheme envisages a wide variety of integrated activities such as mini dairy units, calf rearing, fodder development, chaff cutters, milking machines, bio gas and vermin composting to focus on holistic development of the blocks having high potential for Integrated Dairy development. III. Development initiatives of NABARD in the district In the context of holistic development, NABARD has been taking various initiatives in the district such as formation of Farmers Clubs, supporting eco-friendly projects under UPNRM, promoting development in 17 watersheds which are at different stages, promotion of nine Farmer Producer Organisations, micro entrepreneurship, sponsoring TFO literacy campaigns, support to RUDSETI for conducting training for rural youth, co-operating with TNAU & VUTRC for technology dissemination, etc. IV. Critical infrastructure requirements Critical infrastructure requirements of the district having a bearing on the credit potential which are discussed in greater detail elsewhere in this document are: a. Setting up of community drying yards b. Veterinary dispensaries c. Seed processing unit for supply of quality seeds d. Completion of the 58 Canal scheme in Usilampatti block e. Infrastructure facilities in weekly shandies f. Exclusive marketing hub for Madurai Malli (Jasmine) in Usilampatti V. Status of SAMIS and other monitoring systems The level of submission of LBR 2 is 97 % as on 31 March For monitoring the various programmes, fora such as DCC/DLRC/BLBC are utilised. Effective implementation of TFO Inclusion Plan is deliberated in detail. Bankers are also being motivated to promote more and more Joint Liability Groups (JLGs) to ensure coverage of oral lessees and tenant farmers. iii

4 VI. Conclusion Co-ordinated approach among all the stake holders is crucial to enhance capital formation in the district through Term lending. Fora such as DCC/DLRC/BLBC can be very effective not only in monitoring the credit flow but also to pinpoint the focus areas for the benefit of the bankers and the borrowers. With incidence of drought becoming more frequent, emphasis on water management and conservation, promotion of integrated farming and realising the potential of JLG financing as a credible collateral substitute can spur the growth of the district s economy. iv

5 Broad Sector-wise PLP Projections State: Tamil Nadu District: Madurai S. No. Sector (Rs lakh) PLP Projections A Farm Credit 1 Crop production, Maintenance & Marketing Term Loan for agriculture and allied activities Sub Total B Agriculture Infrastructure C Ancillary activities I Credit Potential for Agriculture (A+B+C) II Micro, Small and Medium Enterprises III Export Credit IV Education V Housing VI Renewable Energy VII Others VIII Social Infrastructure involving bank credit Total Priority Sector (I to VIII) v

6 Sl. No. I A Summary of Sector/Sub-sector-wise Projection ( ) Particulars Credit Potential for Agriculture Farm Credit (Rs. lakh) PLP Projection i Crop production, Maintenance & Marketing ii Water Resources iii Farm Mechanization iv Plantation and Horticulture v Forestry and Wasteland Development vi Animal Husbandry - Dairy vii Animal Husbandry- Poultry viii Animal Husbandry- Sheep, Goat, Piggery, etc ix Fisheries (Marine, Inland &Brackish water) x Others Bullock, Bullock cart, etc B Sub Total Agriculture Infrastructure i Construction of storage facilities (Warehouses, Market yards, Godowns, Silos, Cold storage units/ Cold storage chains) ii Land development, Soil conservation, Watershed development iii Others (Tissue culture, Agri bio-technology, Seed production, Bio pesticides/ fertilizers, Vermin composting) Sub Total C Ancillary activities i Food and Agro processing ii II Others (Loans to Cooperative Societies of farmers for disposing of their produce, Agri Clinics/ Agri Business Centres, Loans to PACS / FSS/ LAMPS, Loans to MFIs for on lending) Sub Total Total Agriculture Micro, Small and Medium Enterprises i MSME Working capital ii MSME Investment credit Total MSME III Export Credit IV Education V Housing VI Renewable Energy vi

7 Sl. No. VII Particulars Others (Loans to SHGs/ JLGs, loans to distressed persons to prepay non-institutional lenders, PMJDY, loans to state sponsored organisations for SC/ST) PLP Projection VIII Social Infrastructure involving bank credit Total Priority Sector vii