PLP 2016-17 District

EXECUTIVE SUMMARY

The geographical area of the district is 13,076 sq. kms, which is divided into 5 revenue divisions viz., Nellore, Atmakur, Kavali, and . The population of the district as per the provisional figures of 2011 census is 29.64 lakh.

The economy of the district is primarily agrarian with 80% of the people depending on agriculture and allied activities for their livelihood. Paddy cultivation, horticulture, aqua culture, dairy, and sheep farming are important occupations of people in the district. Weaving is an important rural livelihood activity. While the coastal and delta mandals are developed, the upland mandals are relatively underdeveloped due to lack of assured irrigation. The major commercial crops are groundnut, sunflower, sugarcane and tobacco. Major horticultural crops are mango, acid lime, sweet orange, cashew nut, coconut, guava, vegetables like leafy vegetables, brinjal and ladies finger etc. The overall performance of banks under District Credit Plan during 2014-15 was 84.04% (including non-farm sector) and the credit flow under priority sector was `386,612.00 lakh as against the target of `487,249.00 lakh. Credit flow under crop loans was `192,080.00 lakh as against the target of `291,856.31 lakh. The achievement under term loans exceeded DCP target, clearly showing the importance given to investment activities. The district is served by 37 commercial banks with a network of 277 branches, Andhra Pragathi Grameena Bank with 83 branches, SPSR Nellore DCCB with 18 branches and 99 PACS and APSFC. 24 new branches have been opened in the district during 2014-15. The average CD ratio of banks is 164.20% over the last 3 years. In 2014-15, bank credit to priority sector, agriculture, weaker sections and women was 78.68%, 46.99%, 28.23 % and 17.01% respectively. Average achievement of Annual Credit Plans was 106% during the last three years.

The theme for the PLP 2016-17 shall be “Accelerating the pace of capital formation in agriculture and allied sector”.

Potential Linked Plan projections- 2016-17

The total credit potential for 2016-17, under priority sector for is estimated at `779,533.72 lakh registering a growth rate of 24.22% over the PLP projection and 31.15% over the ACP target for the year 2015-16. The crop loans have been projected at `363,765.90 lakh, term investment for Agriculture and Allied Activities at `109,726.33 lakh, MSME `167,347.00 lakh and Other Priority Sector `138,694.49 lakh.

Area Based Schemes Considering large number of small and marginal farmers and people below the poverty line and as also the extensiveness of agriculture and rural development there is a need for promoting single purpose small scheme on a cluster basis which was aggregated into area development scheme. Besides cultivation of paddy and pulses, cultivation of flowers is another important activity in the district. The district has considerable upland areas which provide opportunity for rearing of small ruminants like sheep/ goat. Considering potential for these two activities, area development schemes on Tube Rose cultivation and sheep/ goat rearing have been prepared in consultation with line departments & Banks. These schemes may be encouraged by banks in the identified cluster which would also facilitate planning and execution of infrastructure facilities viz., backward and forward linkages for full realization of the benefits of the scheme.

1

PLP 2016-17 Nellore District

Highlights of developments / initiatives having bearing on the credit flow NABARD has taken up many developmental initiatives viz., 24 watershed development programmes under distress district package, and 4 TDF projects and banks are expected to meet the credit needs in treated watershed projects. Other initiatives include promotion of JLGs, godown accreditation and technology interventions which would have direct bearing on the credit flow. Under PODF, NABARD has taken initiative developing PACS as a one stop shop unit for meeting all the needs of the farmers like providing agriculture implements on hire basis, enabling purchase of inputs, having good quality storage capacity as per WDRA approved warehouse etc. The schemes on dairy development and fisheries have facilitated increased flow of credit to these sectors. Three FPOs were sanctioned in the district during the year 2014-15 which have started their operations in the respective activities.

Thrust areas In view of the latest guidelines from Reserve Bank of on Priority Sector, the thrust areas for 2016-17 are financing MSMEs, Farmer Producer Organizations, financing of landless farmers through formation of JLGs/SHG financing, financing against NWRs, area based schemes, other priority sectors like Housing Loan, Education Loan and Export Credit.

Infrastructure – Government & Private investments Infrastructure development is a necessary pre-condition for integrated rural development in the district. Rural Infrastructure Development Fund (RIDF) serves as a supplement to the efforts being made by State Governments in this direction. The cumulative sanctions and disbursements under Tranche I to XX are `62,098.50 lakh & `39,063.34 lakh respectively covering 1233 projects. Potential created under micro irrigation was 24,465 ha & irrigation potential created to an extent of 17,000 ha through irrigation projects. Nearly 70% of the RIDF projects were implemented towards development of irrigation, roads, CLDP works which would help development of agriculture. The critical infrastructure required for the district are water harvesting structures, micro irrigation, custom hiring and agro service centers etc. Private investments under rural godown, cold storage, seed processing etc., are capable of creating huge impact leading to increased production and productivity, better price realization by farmers there by higher credit off take.

Major constraints & Suggested action points  Major constraints are low crop diversification, indiscriminate use of fertilizers & pesticides, inadequate capital formation, poor recovery under Govt. Sponsored Programmes, availability of godown space & other marketing infrastructure etc.  Availability of inputs & minimum support price to farmers.  Govt. to encourage organic farming practices, to reduce the use of pesticides.  In view of depletion of groundwater, there is an imminent need to recharge the ground water, bring in proper legislation and usage of water saving devices.  Scientific storage, supply chain management & market linkages.

Conclusion

In order accelerate the pace of capital formation in agriculture, wholehearted support of financial institutions, line departments, policy makers, etc., is very vital. With agri infrastructure involving huge outlay being a part of the priority sector lending, banks may lend to viable agri-infra projects to boost the growth in agriculture productivity and marketing. There is a need for coordinated approach from all the developmental agencies, banks and PRIs with good reporting system for priority sector lending for ensuring smooth implementation of various programmes. NABARD is committed to play a greater role in the successful implementation of all existing and new policies of GoI and RBI towards achievement of sustainable agriculture and rural prosperity in the coming years.

2

PLP 2016-17 Nellore District

Broad sector-wise PLP projections for 2016-17 (` lakh) S.No. Sector/Activity PLP Projections A Farm Credit (i) Crop Production, Maintenance and Marketing 363,765.90 (ii) Term Loan for Agriculture and Allied Activities 109,726.23 Sub Total 473,492.13 B Agriculture Infrastructure 15,929.29 C Ancillary activities 5,817.05 I Credit Potential for Agriculture (A+B+C) 495,238.47 II Micro, Small and Medium Enterprises 167,347.00 III Export Credit 5,100.00 IV Education 20,400.00 V Housing 48,527.50 VI Renewable Energy 538.25 VII Others 41,250.65 VIII Social Infrastructure involving bank credit 1,131.75 Total priority Sector (I to VIII) 779,533.72

3

PLP 2016-17 Nellore District

Summary of Sector / Sub-sector wise PLP projections -2016-17

PLP Projections S.No. Sector/Activity (` lakh) I Credit Potential for Agriculture (A+B+C) A Farm Credit (i) Crop Production, Maintenance and Marketing 363,765.90 (ii) Water Resources 3,464.81 (iii) Farm Mechanization 18,414.40 (iv) Plantation and Horticulture 4,759.30 (v) Forestry and Wasteland 3,245.94 (vi) Animal Husbandry – Dairy 14,389.52 (vii) Animal Husbandry – Poultry 913.16 (viii) Animal Husbandry – Sheep, Goat, Piggery, etc. 10,730.25 (xi) Fisheries 7,169.60 (x) Others –Bullock, Bullock cart, SHGs etc. 46,639.35 Sub Total 473492.23 B Agriculture Infrastructure (i) Construction of storage facilities (Warehouses, Market yards, 13,590.00 Godowns, Silos, Cold Storage units / Cold storage chains) (ii) Land development, Soil conservation, Watershed development 1,757.57 (iii) Others (Tissue culture, Agri bio-technology, Seed production, Bio- 581.72 pesticides/fertilizers, Vermi composting) Sub Total 15,929.29 C Ancillary activities (i) Food and Agro processing 5,547.05 (ii) Others (Loans to cooperative societies of farmers for disposing of 270.00 their produce, Agri Clinics/Agri Business Centres, Loans to PACS/FSS/LAMPS, Loans to MFIs for on-lending) Sub Total 5,817.05 Total Agriculture 495,238.57

II Micro, Small and Medium Enterprises (i) MSME-Working capital 47464.00 (ii) MSME-Investment Credit 119883.00 Total MSME 167347.00 III Export Credit 5100.00 IV Education 20,400.00 V Housing 48527.50 VI Renewable Energy 538.25 VII Others (Loans to SHGs/JLGs, loans to distressed persons to prepay 41250.65 non-institutional lenders, PMJDY, loans to state sponsored organizations for SC/ST) VIII Social Infrastructure involving bank credit 1,131.75

Total priority Sector (I to VIII) 779,533.72

4

At a Glance

Total Geographic Area : 13076 sq km Coastline : 163 km Gross Cropped Area : 394,565 Ha

River : Pennar Seaport : Percentage area under agri and allied activities : 70.81 %

Major Crops/ Activities Production (in Million MTs.)

Paddy Lime 1.59 0.27 Sugarcane Fruits 0.66 0.44 Fisheries 0.19 Coconut 6.01 Lakh No. nuts

Agricultural Research Stations Kavali, Podalakuru & NEllore Citrus Research Station --Pettluru KVK – Nellore