"We demand from the government to immediately intervene and ask the bank to withdraw its decision of suspending new loans for buying tractors and implements," Association President L D Mittal said.
Stating that tractors and farm implements have become integral part of the Indian agriculture sector for achieving sustainable production level, he said, "The bank's decision will eventually hit the agriculture growth as food grain production would come to a standstill for want of tractors and other equipments".
Describing the bank's move as equally hard for the tractor industry, Mittal, who is also Chairman of Sonalika Group that has interests in tractor manufacturing, said that this decision of the bank could completely erode the tractor industry's growth.
"The sale of tractor business was growing at a pace of 10-15 per cent and we think that it could be zero with the implementation of the decision," he asserted.
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He said that presently, 95 per cent of tractors being sold in the country are financed through banks and SBI contributes major share in tractor financing business.
He feared that other banks might follow the same path which would be detrimental to the farm sector growth.
SBI has put on hold financing of new tractors and other farm implements with immediate effect in view of high over dues in this segment.