Tractor firms seek easy finance

The Tractor Manufacturers Association (TMA) on Monday asked commercial banks to do away with the minimum land holding condition in their offer of loans for buying tractors.

"If you take a car loan, you are not required to mortgage your house, so why should farmers have to mortgage their land, in addition to hypothecating their tractor," TMA president R C Jain said in a statement.

As per the existing norms, farmers need to have at least eight acres of land to take advantage of tractor finance and thereafter the borrower is required to hypothecate the tractor and mortgage the land to the bank.

If banks remove the norm of land mortgage, the apex body argued, the tractor market will expand.

Removing the mortgage norm would complement the decision announced by the finance minister to eliminate excise duty on tractors, Jain said.

In the face of looming drought, TMA said public sector banks could relax the land-holding norm at least in drought-hit areas as a first step.

The association had met Nabard chairperson in this regard and would also be taking up the issue with others concerned.