PLP 2016-17 West Godavari Executive Summary The role of credit planning has assumed greater significance at a juncture when the focus is on technological upgradation and commercialisation of agriculture for improving its profitability thereby assuring a decent livelihood to the large section of population dependent on it. NABARD in the year 2012-13 had prepared Base PLP for five years coterminous with the XII Five Year Plan (2012-17). The Base PLP projected a five year credit potential under priority sector covering Primary, Secondary and Tertiary sectors, with emphasis on the Primary Sector. These projections were based on parameters such as technical feasibility, availability of infrastructure, availability of exploitable resources, cropping pattern, agricultural practices and other developmental indices such as access to markets, etc. Some of these parameters have undergone changes due to change in Governments priorities and policies, change in RBI guidelines, strengthening of rural infrastructure, market forces, cost escalation, etc., necessitating a relook at the current potential for the year 2016- 17. Considering these aspects the potentials were assessed. The theme for the current PLP is “Accelerating the pace of capital formation in agriculture and allied sector” West Godavari is one of the coastal districts of Andhra Pradesh which lies in Godavari Western delta and Krishna Eastern delta. The irrigated area in the district is catered by Godavari Western delta and Krishna Eastern delta systems besides bore wells, filter points and irrigation tanks. About 90% of the gross cropped area is under irrigation. The soils are richly fertile, alluvial, black regur and red ferrugenous, besides small belt of arenaceous sandy soils along the coastal belt. The normal rainfall of the district is 1153 mm and deficient rainfall recorded during 2014-15 at 605 mm. The West Godavari district is known as one of the rice granaries of the State and an agriculturally developed district. During 2014-15, it produced 16.54 lakh Mt. of Rice. Other significant crops produced are maize at 4.43 lakh MT, Oilseeds at 0.64 lakh MT, Pulses at 0.13 lakh MT and total commercial crops at 18.11 lakh Mt. Agriculture and Horticulture resources such as Paddy and its Bi-product Rice Bran, Maize, Oil Palm, Lemon, Cashew, etc., are taken up besides mineral based resources such as ball clay, fire clay, quartz, road metal, building stone minerals and Aqua based resources such as Fish and Prawn. The important non-farm activities in the district are Handloom activity that is spread in fifteen mandals of the district, export quality crochet lace manufacturing tiny sector in Narasapur mandal and production of quality carpets located at Eluru. There are 3647 MSMEs established in the district with a total investment of ` 2046.20 crore and generating employment to 38717 persons. West Godavari district has a well-developed banking network with 22 commercial banks having 412 branches, Chaitanya Godavari Grameena Bank (CGGB) with 31 branches, APGVB with 2 branches and Eluru DCCB with 34 branches and Khammam DCCB with 1 branch. Besides this, there are 257 PACS affiliated to Eluru DCCB providing credit to its members. APSFC has a branch at Eluru to extend industrial finance. The district has reported over 90% coverage under Financial Inclusion. Andhra Bank and SBI accounts for major chunk of business with 113 and 75 branches respectively out of total 477 branches of CBs. All commercial banks including private sector banks account of 81.79 % and 81.07% of total deposits and advances outstanding in the district. 1 PLP 2016-17 West Godavari Priority Sector – Ground level credit The ground level credit viz., 2011-12, 2012-13 and 2013-14 for Priority Sector shows steady increase and stood at `5653.43 crore, `7128.50 crore, `8027.13 crore. However, during 2014-15 it has declined to `5173.48 crore. The major share in the GLC was Crop loans and the last four years it was above 60% of the GLC. The delay in release of debt waiver instalment by GoAP adversely affected the disbursement of crop loans during 2014-15. However, the average annual growth in crop loans is around 10% during normal years. This has impacted the other loans also. The performance under ACPs for the years 2012-13 and 2013-14 was 132% and 117%, respectively. However, during 2014- 15 achievement against the target was only 52%. The major sectors in investment credit were Fisheries, Animal Husbandry, Farm mechanization and Agricultural Infrastructure. Potential estimated for the year 2016-17 The exploitable potential is estimated for the year 2016-17, the priority sector credit requirement of the district for the terminal year is estimated at `1352225.74 lakh which represents 27% increase over previous year potential of `1067054.10 lakh. The exploitable potential for major sectors are viz., Crop loan `602392.53 lakh, Term loan for agriculture and allied activities `356148.97 lakh, Agriculture Infrastructure `45403.64 lakh, Ancillary activities `4145.62 lakh, MSME sector `129808.00 lakh, Export Credit `79600.00 lakh, Education `34250.00 lakh, Housing `60489.00 lakh, Renewable Energy `8431.04 lakh, Others (SHGs/JLGs, etc.) `28657.15 lakh and Social Infrastructure involving Bank credit `2899.80 lakh. Priority sector disbursements are showing steady trend during the last four years except 2014-15. Crop Production, Maintenance and Marketing The Gross Cropped Area in the district stood at 6.91 lakh ha while the Net Sown Area stood at 4.17 lakh ha. The irrigated area in the district under assured irrigation through various sources, with canals, tubewells and filter points accounts for 85% of Gross Cropped Area. Total dependence on rainfall is 10%. Paddy is the major crop grown in the district in an area covering 409286 ha. The other major crops being grown during Kharif and Rabi are Maiz, Pulses, Oilseeds and Jower. During khariff is sugarcane and cotton. During Rabi Tobaco and chillies. The scale of finance were last fixed during 2014-15 and the same is in vogue as of now. Considering the trends and potentials, crop loan projections were worked out to `602392.53 lakh. Investment credit for Agriculture Water Resources: West Godavari district lies under Godavari and Krishna delta. The irrigation system is well developed. About 85% of the gross cropped area is under irrigation. Of the total irrigated area, canal irrigation under Godavari Western delta and Krishna Eastern delta account for 60% and the balance under tube wells and filter points, MI tanks, Lift irrigation, etc. Further, Kovvadakalva medium irrigation project, Thootigunta and Polavaram-lift irrigation schemes through RIDF have been completed and new areas are brought under irrigation. Lift irrigation schemes under Yerrakalava financed under RIDF XIV were completed and water will be available for 5,900 acres. The State Ground Water Department and Central Ground Water Board re-assessed the ground water resources in 2010-11 and identified as safe all the mandals in the district except Lingapalem mandal (semi-critical). The projection for 2016-17 was arrived as `20407.02 lakh. Farm mechanization: The recent trends indicate that the demand for mechanizing transplantation and harvesting operations by use of paddy transplanters, combine harvester and use of small tractors 2 PLP 2016-17 West Godavari has been increasing besides that tractors and power tillers. The increased labour wages coupled with need to attend farm operations in time increased demand for farm equipment. The potential for the year 2016-17 has been projected as `27175.20 lakh. Supplying high cost farm mechinary at subsidy is one of the major demands of farmers. Plantation and Horticulture : West Godavari district is potential for growing various Horticultural crops like Cashew, Mango, Coconut, Oil Palam, Banana, Citrus, Sapota, Guava, Vegetables, Flowers, Medicinal and Aromatic plants. Due to available resources like land, irrigation and other infrastructure facilities, there is a vast scope for the development of Horticulture in this district. The district is a front running producer of a variety of Horticulture wealth. Horticultural crops are growing in an area of 1.40 lakh Ha. constitutes 33% of the net-cropped area of 4.26 lakh ha. More than three-fourth of Horticulture crops are grown in 24 upland mandals and remaining in 22 delta areas. The major horticulture crops covered in the district and production for the year 2014-15 are Banana, Coconut, Mango, cashew nut, Tomoto and Sapota. In order to support this sector, the potential for the year 2016-17 has been projected as `9213.37 lakh. Animal Husbandry: As per the Livestock Census 2012, the district has 215112 cattle and 6,22578 buffaloes (Breedable female cattle - 81885 and buffaloes- 325818 ). CB cattle account for 31% of total cattle population. Dairy activity has become mainstay of small and marginal farmers in the district. Milk is collected by organized and local vendors in the district. The milk production in the district is estimated at 8.63 lakh MT (8.9% of state milk production, 5th position among districts) for the year 2014-15 and buffaloes accounted for nearly 83% of the district milk production. The average yield based on animals in milk is 5.85 kgs/ day as against state average of 5.13 kg/day. The district had a poultry population of 161.79 lakh (127.18 lakh commercial layers and 20.91 lakh commercial broilers). The egg production in the district for the year 2014-15 is estimated at 237.77 crore (18.2 % of total state egg production and second position in the state). Improved birds account for 93% egg production. Poultry accounts for 73% of total meat production in the district. Considering the demand for eggs and poultry meat, a large number of farmers have taken up poultry farming in the district.