Executive Summary
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PLP 2016-17 Vizianagaram EXECUTIVE SUMMARY 1 Salient features of Vizianagaram District Vizianagaram district is predominantly an agricultural district as 60% of the workers are engaged in agriculture and about 79% of the population in the district who live in rural areas are depending on agriculture directly or indirectly for their livelihood. Rainfed farming is the characteristic feature of agriculture in the district as about 53% of its area is cultivated purely under rainfed conditions. Agriculture is the major economic activity and major crops grown in the district are rice, groundnut, mesta, sugarcane, cotton, maize, ragi, bajra and pulses during rabi season. The average yields obtained in the district are low due to the erratic rainfall. Being quite close to Visakhapatnam city, and with well-connected road, rail and air connectivity, the district has an advantage in producing and marketing of products. 2 Banking profile and Annual Credit Plan The district had 31 banks with 270 branches as on 31 March 2015 - 178 Commercial Bank branches, 76 branches of Andhra Pradesh Grameena Vikas Bank, 16 DCC Bank branches and AP State Financial Corporation and 94 PACS affiliated to the Vizianagaram DCCB also cater to the credit needs in the district. The total deposits and advances outstanding of all the banks in the district as on 31 March 2015 stood at `4997.47 crore and `4164.03 crore respectively. The CD ratio as on that date stood at 83%. The Annual Credit Plans for the year 2012-13, 2013-14 and 2014-15 set a target of `1731 crore, `2200 crore and `2468 crore under priority sector respectively. The achievements under ACP during the period stood at `2062 crore, `1906 crore and `1050 crore respectively. 3 PLP projections for 2016- 17 NABARD in the year 2012-13 had prepared base PLP for five years co-terminus with XII Plan. The base PLP projected a five year credit potential under Priority sector covering Primary, Secondary and Tertiary sectors, with emphasis on the primary sector. Taking into account the changes in the composition of priority sector brought in by the Reserve Bank of India, the composition of PLP 2016-17 has also been modified and presented under Farm Credit, Agriculture Infrastructure, Ancillary Activities, Micro, Small and Medium Enterprises (MSME), Export Credit, Education, Housing, Renewal Energy and other. NABARD has estimated an exploitable potential of `3579.13 crore under Priority Sector for the year 2015-16 and the Annual Credit Plan has set a target of `2785 crore, an increase of 12.8% over the previous year under priority sector lending. Agriculture being the core sector of the district, an amount of `2040 crore has been earmarked. Crop loans being thrust area under Agriculture Sector, an amount of `1444 crore has been allotted under crop loans constituting 52% of the total priority sector advances. An amount of `208 crore has been projected under agricultural term loans and `388 crore under Allied activities. The share of agricultural lending both crop loans and term loans formed 73% of the total priority sector lending for the year 2015-16. The potential for the year is estimated keeping in view the revised Priority Sector Guidelines, taking into account important developments that have a bearing on the likely credit flow to various sectors, viz., revision in the scales of finance and unit costs, various initiative proposed by the State Govt for achieving double digit growth under Primary Sector Mission, etc. The exploitable potential for the year 2016-17 has been estimated at `451897.68 lakh. The credit potential for agricultural has been estimated at `293,447.51 lakh forming 65% of the total projections, while the share of Other Priority Sector and MSME stood at 22% and 11% respectively. 1 PLP 2016-17 Vizianagaram 4 Sector wise credit potential and critical interventions a) Crop production Short term credit for crop production plays an important role in changing the face of economic scenario of the district. Provision of adequate and timely credit, mechanization of farming operations, availability of quality seeds, coverage of non-loanee farmers and financing tenant farmers through JLG/LCEC mode, implementation of revised KCC norms, utilization of extension officers exclusively for extension job, setting up custom hiring centres will enhance the credit flow under crop production. A credit potential of `215,290.81 lakh has been assessed for the activity for the year 2016-17. With the initiative of GoAP, digitization of land records would help the banks in mitigating the problems associated with improper documents / land titles. b) Water Resources With the launching of Thotapalli project, it is expected that 40,000 ha. would be brought under assured irrigation. Expanding cultivable area under assured irrigation, improving on farm water use efficiency to reduce wastage of water, energization of pump set with solar power, financing new farm ponds/rain water harvesting structures would maximize water availability and creation of awareness on conjunctive use of water etc. are important steps for tapping the available potentials under the sector. A credit potential of `7621.05 lakh has been assessed for the activity for the year 2016-17. c) Farm Mechanization In order to encourage mechanization in agriculture, more focus is to be on usage of tractor driven farm implements, transplantors, power tillers, threshers, rotovators, etc. Extending credit for setting up of custom hiring centres for maize, etc., has good potential. A credit potential of ` 4762.62 lakh has been estimated for the activity for the year 2016-17. d) Plantation and Horticulture Horticulture is one of the thrust areas in the overall development of the district and sustainable development of Horticulture is aimed at by increasing area, productivity, by encouraging post-harvest management. Ample scope exists for expanding the area under mango, cashew, oil palm and vegetable cultivation. Intensive vegetable production, necessary management under protected cultivation (poly houses / shade nets) is also being promoted in specific locations in the district. Keeping in view the requirements of the sector, a credit potential of `4992.93 lakh (including Sericulture) has been estimated for the activity for the year 2016-17. e) Animal Husbandry Dairy is one the activities having scope for implementing the Area Development Plan Creation of awareness among the rural populace on the importance of dairying as a livelihood activity will have large positive impact on the sector. The other intervention which will have impact on the sector is promotion of calf-rearing in induction of quality animals from the neighbouring states. An amount of `23220.83 lakh, `2066.22 lakh and `1607.31 lakh has been assessed for Dairy, Poultry and Sheep & Goat rearing for the year 2016-17. f) Agriculture infrastructure Keeping in view the revision in the priority sector guidelines, a separate chapter ‘Agriculture Infrastructure’ has been introduced this year with projections for construction of storage facilities, land development & others. A credit potential of `1077.48 lakh, `2103.37 lakh and `2077.72 lakh has been assessed for these activities respectively for the year 2016-17. 2 PLP 2016-17 Vizianagaram g) Micro, Small & Medium Enterprises (MSME) Initiatives of the Government of India under Make in India programme and identification of Mining, manufacturing, MSME under industries sector and Education, Trade, Transport, Hotels, Health care, etc., under service sector for achieving double digit growth under Primary Sector Mission would encourage give boost for industrialization of the district. A credit potential of ` 51926.40 lakh has been estimated for the year 2016-17. h) Informal Credit Delivery System In order to strengthen SHG movement in the district, the future roadmap for strengthening the SHG movement may include Identification of potential activities for setting up of Micro Enterprises and motivating members for taking up the activity, training and capacity building of identified SHG members who are availing higher doses of finance under the programme, identification of dormant groups and initiate steps for their revival, training and capacity building of stakeholders including bank branches and other staff of banks, strengthening recovery mechanism at branch/mandal level, etc. A credit potential of `105,648 lakh has been assessed for the activity for the year 2016-17 of which an amount of `31,94.33 lakh has estimated for lending to SHGs for various agricultural purposes. The district has ample potential for development of agriculture, horticulture, animal husbandry and fisheries sectors. Further, proximity to Visakhapatnam port provides good scope for development of MSME and mining sectors. Initiatives of the State Government under Primary Sector Mission and improvement in extension support would result in higher demand for credit. Under Primary Sector Mission, Agriculture, horticulture, livestock and fisheries have been identified for ensuring double digit growth and sector specific strategies are being implemented by the State Government. NABARD has been extending concessional refinance to RRBs and Cooperative Banks under Long Term Rural Credit Fund to give a boost to long term investment credit. Banks need to extend hassle free and timely credit as per scale of finance and unit cost. Coverage of tenant farmers and extending credit facilities for setting up of MSME units may help in exploiting the potentials estimated under PLP 2016-17. 3 PLP 2016-17 Vizianagaram