Priority sector credit potential up in Andhra

The credit potential in Andhra's priority sector during the next financial year is estimated at Rs 42,460.50 crore, about 15.2 per cent higher than the previous projections and 24 per cent over the state credit plan target of Rs 34,043 crore in the current year.

State finance minister K Rosaiah, while quoting the state focus paper 2008-09 prepared by the National Agriculture Bank for Rural Development (Nabard), said of the total estimated credit potential, around Rs 25,000 crore was being generated by agriculture and allied sectors and close to Rs 4,900 crore was expected to come from the non-farm sector including agro-processing.

Speaking at the credit seminar organised by Nabard, the minister pointed out that proper credit flow would encourage farmers to take up allied activities like dairy and non-farm activities to help supplement their income especially during droughts. He asked banks to adequately finance these sectors.

The state government has partnered the Centre and Nabard to revitalise cooperatives, an important source of farm credit to the farmers, through recapitalisation of cooperative banks.

"Once the cooperatives are back into the business of lending, the credit flow to the rural sector will further improve," he added.