The disbursement of investment credit by the National Bank for Agriculture and Rural Development (Nabard) to the Karnataka government dropped 29.1 per cent to Rs 745 crore during 2009-10 compared with the previous year. The overall assistance from Nabard for the state during 2009-10 was Rs 3,472 crore, a growth of 15-16 per cent over the previous year.
Venkatesh Tagat, chief general manager, Nabard, said the drop in investment credit was mainly due to excess liquidity with commercial banks and as a result the demand for refinance from Nabard was comparatively lower. There was a delay on the part of the state to draw funds added to the slower growth of investment credit.
For 2010-11, Nabard has estimated a potential for credit deployment of Rs 37,000 crore in Karnataka. This includes Rs 17,250 crore for crop loans, Rs 6,674 crore for term credit in agriculture and allied activities, besides Rs 13,340.5 crore for non-farm sector, agro and food processing and other priority sectors.