Indian Bank to focus on hi-tech agri projects

Indian Bank is all set to focus on funding technologically advanced agriculture projects in Gujarat. The decision has been taken by the bank owing to assured returns on its principal amount with its interest.

Mohan Lalwani, DGM & circle head of Gujarat/Rajasthan, Indian Bank, said, "The bank expects assured returns of about 20 to 25 percent from technologically advanced agricultural projects, which has led us to focus on this area, ".

In the last few months, the bank has sanctioned Rs 13 crore for funding advanced agricultural projects in Gujarat. It is also looking at financing entrepreneurs with innovative business ideas.

"By financing innovative business plans in the agricultural sector, we are trying to promote modern agriculture practices among the farming community," said Lalwani.

Indian Bank has recently provided Rs 9 crore finance to an export-oriented rose plantation project in Navsari district. Deepak Patel, managing director of Best Roses Biotech, who was funded by the bank, said, "We were earlier engaged in traditional planting of sugarcane but switched over to roses because of the bank's scheme."

The company cultivates roses under the green house system that gives five times more output than the open cultivation system. He added that many banks were still doubtful about the success of high technology agriculture projects.

The bank has also provided finance to a bio-diesel project in Navsari, a hi-tech agri project undertaken by Dharmendra Parekh, who in-turn has set up a small scale company under the name of Aaditya Aromedic & Bio Energines Pvt Ltd.

Speaking to Business Standard, Parekh said that the entire project was carried out on 5000 acres of land under the contract farming model. Farmers around the area on Navsari will cultivate jethropa, which is the main ingredient for bio-diesel.

The company has set up a bio-diesel production plant with a capacity of 12000 liters per day. Like Patel, even Parekh was of the view that not many banks came forward for financing hi-tech agriculture.

The bank has also funded an agri project for the production of cattle feed. Another agricultural project to produce capsicum of all the three varieties in Gujarat is in the pipe line.

Encouraged by the success of its funding to agricultural projects in the state , Indian Bank is mulling increasing its funding for the projects up to Rs 50 crore by the next two to three months.