Accelerating the Pace of Capital Formation in Agriculture and Allied Sector ” Is the Main Theme of This Potential Linked Credit Plan for 2016-17
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PLP 2016-17 Tirunelveli District EXECUTIVE SUMMARY “Accelerating the pace of capital formation in agriculture and allied sector ” is the main theme of this Potential Linked Credit Plan for 2016-17. 1. Introduction The Potential Credit Linked Credit Plan(PLP) is intended to provide insight on the potential for development in different sectors of the rural economy, a road map to banks for extending credit to important important sectors/sub-sectors/activities in the district and for Government departments and various developmental agencies to provide necessary infrastructure and linkage support for the development of various sectors and also coverage their plans with that of banks, thereby facilitating increased credit flow and overall development. Tirunelveli district is predominantly agrarian with Net Sown Area(133501 ha during 2013-14) of the district constituting 20% of its geographical area(675850 ha). The Gross Cropped Area of the district is 162144 Ha(during 2013-14) with the cropping intensity of 121%. Paddy, maize, blackgram, greengram,groundnut, cotton, sugarcane, banana and vegetable crops are the major crops grown in the district. The district is blessed with perennial rivers viz., Thamiraparani, Vaippar, Nambiar and Hanumanathi. Thamirparani is the major river basin in the district. The district is also noted with the presence of major irrigation dams viz., Papanasam, Manimuthar, Servalar, Karuppanathi, Gadananathi, Kundaru, etc. The major sources of irrigation are by way of wells(49%), tanks (31%), and canal irrigation (20%) during 2013-14. About 69% of net sown area was irrigated during the year 2013-14. Allied activities of agriculture like dairy and sheep/goat rearing play vital role in the rural economy of the district. There is a vast scope for bringing investments in various sectors of agriculture in the district. 2. Bank Network and Credit flow The district has a well spread out network of bank branches numbering 404 with commercial banks having 304 branches in the district. The district is also benefitted with the significant presence of branches of Grama Bank and Cooperative banks as Pandyan Grama Bank and Tirunelveli District Central Cooperative Bank are operating 56 and 30 branches respectively. There are 6 branches of Urban Cooperative Banks and 8 PLARDBs in the district. The details of ground level credit flow under priority sector lending in the district is given as under: (₹. Lakh) Sectors Achievement Target-2015-16 2012-13 2013-14 2014-15 Crop Loan(a) 229081.57 321812.99 328049.50 276353 .00 Agrl. Term Loan(b) 22085.97 34760.77 63114.73 163647 .0 Total Agrl. credit 251167.54 356573.76 391164.23 440000 .00 (a+b) Micro&Small 21172.67 31383.94 31383.31 39000 .00 Entreprises(c) Other Priority 81772.57 96981.60 108732.00 125000 .00 Sectors(d) Total(a+b+c+d) 354112.78 484939.30 531279.54 604000 .00 The achievement under ACP 2014-15 was ₹.531279.54 lakh against the target of ₹. 479000.00 lakh constituting 111% of the target. The credit flow during the year 2014-15 showed an increase of 9.6% over ₹ 484939.30 lakh disbursed during 2013-14. The achievement under ACP 2014-15 PLP 2016-17 Tirunelveli District for agriculture was ₹ 391164.23 lakh constituting 116% of the target. The credit flow under the agriculture sector is an increase by 9.7% over the achievement of ₹ 356573.76 lakh during the year 2013-14. The achievement under agriculture constitutes a share of 74% under ACP during the year 2014-15. The achievement under crop loan and Agrl. term loan under Agriculture was in the ratio of 84:16. The credit flow under micro& small entreprises sector and other priority sector during the year 2014-15 was ₹ 31383.31 lakh and ₹ 108732.00 lakh respectively. 3. PLP Projections for the year 2016-17 RBI has revised the Priority Sector Lending (PSL) norms vide circular dated 23 April 2015. Priority Sector has been classified into eight broad sectors viz, (i) Agriculture (ii) Micro, Small and Medium Enterprises (iii) Export Credit (iv) Education (v) Housing (vi) Social Infrastructure (vii) Renewable Energy and (viii) Others. The sub sectors and activities covered under each broad sector have also undergone revision. In view of the changes brought out by RBI in the coverage, composition and classification of activities covered under PSL, the composition and content of PLP for the year 2016-17 have been revised so as to align with the revised guidelines on PSL. The potentials have been arrived under the eight broad sectors indicated above. Based on the infrastructure and natural resources available, the potential for credit flow has been assessed at ₹ 731391.00 lakh for the year 2016-17 as against the estimate of ₹ 619288.72 lakh for the year 2015-16 thereby indicating an increase of 18.1%. The potential for credit flow under agriculture has been estimated at ₹ 547453.72 lakh for the year 2016-17. The potential under agriculture has increased by 17.71% over the previous year. Under agriculture, the potential for crop loan and agricultural term loan(including Agricultural Infrastructure and Ancilliary activities) has been assessed at ₹ 358959.00 lakh and ₹ 188494.72 lakh respectively for the year 2016-17. Thus the potential for the year 2016-17 has an increase of 12% and 30.36% for the crop loan and agricultural term loan respectively over the previous year. The potential for crop loan and agricultural term loan accounted for 66% and 34% of share under agriculture respectively. In respect of Agriculture term loan, greater credit potential is observed in sectors like Animal Husbandry-Dairy ( ₹ 37343.43 lakh), Farm Mechanization ( ₹ 25362.34 lakh), Plantation and horticulture( ₹ 23402.56 lakh) and Water resources( ₹ 21500.33 lakh). Credit potential for construction of storage facilities has been assessed at ₹ 12210.00 lakh. Credit potential for Food and Agro-processing sector has been estimated at ₹ 12048.00 lakh. The potential under Micro, small and Medium Enterprises(MSME) sector for the year 2016-17 has been estimated at ₹ 43913.76 lakh. The potential under MSME sector for the year 2016-17 has an increase of 16.8% over the previous year. Credit potential under the sectors viz., Export credit, Education, Housing and Renewable Energy have been assessed separately at ₹ 10000.00 lakh, ₹ 25080.00 lakh, ₹ 29662.50 lakh and ₹ 10909.02 lakh respectively for the year 2016-17. Thrust has been given for other activities viz., Loans to SHGs/ JLGs, loans to distressed persons to prepay non-institutional lenders, PMJDY and loans to state sponsored organisations for SC/ST and credit potential has been estimated at ₹ 58900.00 lakh for the year 2016-17. The activity-wise and block-wise assessment of potential is presented in Annexure I. 4. Critical Infrastructure: Strengthening the irrigation infrastructure in the district is highly essential. Rehabilitation, desilting, strengthening of canals in Thamirabarani and Chitar river basin need to be given priority. Strengthening of Agricutural market infrastructure including construction of adequate number of warehouses and rural godowns is essential to prevent distress sale and wastage. Solar based power generation need to be established to meet the increasing energy requirement in the district. PLP 2016-17 Tirunelveli District 5. Credit flow monitoring: There is a need to assess and monitor the credit flow in to vital sectors of the economy of the district. Necessary interventions have to be made to ensure credit flow in those sectors. Effective implementation of SAMIS system is essential to have a review on the progress made under Annual Credit Plan(ACP). The submission of LBR-2 returns by the financing banks is about 86% in the district. As such, fora like DCC, BLBC are not able to take concrete review on the progress made under Annual Credit Plan by the different banks in various sectors/sub-sectors/activities. Corrective measures through coordinated approach by all the banks have to be put in place to ensure the realisation of credit potential available in the district. 6. Prime Minister Jan Dhan Yojana(PMJDY) : Consequent to implementation of Financial Inclusion programme, number of branches in the district have gone up to 404. BCs numbering 290 have been appointed by the financing banks. About 3.57 lakh accounts have been opened under PMJDY. Smart cards are being issued for PMJDY accounts. However, there is a need to cover all the 425 panchayat villages with the bank network. There is a need to intensify the PMJDY programme so that all the 6.49 lakh households are covered under the financial services by the banks. 7. Social security schemes: Enrollment under insurance and pension schemes viz Prime Minister Jeevan Jothi Bheema Yojana, Prime Minister Suraksha Bheema Yojana and Atal Pension scheme launched during the year 2014-15 by GOI is being done vigorously by the banks in the district. About 3 lakh people have been enrolled under insurance schemes. Awareness is being created on Pension scheme 8. Kissan Credit Cards(KCCs): The District Central Cooperative bank and Pandyan Grama Bank have issued nearly 24000 KCCs in the district. Though Commercial bank branches have issued RuPay KCC cards, there is a need to cover all the 1.08 lakh cultivators with KCCs/RuPay KCCs in the district. 9. National Rural Livelihood Mission: Adequate credit flow to SHG groups, promotion of activity based lending in SHG segment and encouraging financial intermediation by Panchayat Level Federations continue to be thrust areas for developmental agencies and financial institutions. Credit flow of ₹ 32200.00 lakh has been fixed as target for the year 2015-16 for credit linking 11215 SHGs under National Rural Livelihood Mission in the district. 10. Farmer Producer Organizations(FPOs) : FPOs can render or facilitate many farm related services including aggregation and realisation of better price for the produce to the farmers.