Public sector bank advances to farm sector up 19.2% in FY04

Eleven public sector banks' (PSBs) advances to the agriculture sector grew at 19.2 per cent in fiscal 2004 compared with a 12.8 per cent growth logged in fiscal 2003 and 16.8 per cent in fiscal 2002.

The 11 PSBs, whose annual reports are available with Business Standard Research Bureau, reported aggregate advances to the farm sector of Rs 45,077 crore in FY 2004 compared with Rs 37,813 crore in FY 2003.

These 11 banks accounted for nearly 51 per cent of the agriculture loans distributed by the 27 PSBs in 2002-03.

In fiscal 2003, the total 27 PSBs reported a growth of 26.1 per cent in farm lending to Rs 73,330 crore as against a 8.5 per cent growth in FY 2002 (Rs 58,142 crore).

However, of the 11 PSBs, only three managed to cross the benchmark for agriculture sector lending of 18 per cent in 2003-04. The RBI norms stipulate that banks' lending to the agriculture sector should be 18 per cent of the net bank credit in a given year.

This is part of the priority sector lending norms which require every bank to extend 40 per cent of the net bank credit to agriculture, small scale industries and other segments.

Allahabad Bank (18.8 per cent), Dena Bank (18.52 per cent) and Punjab National Bank (18.49 per cent), were the only banks to meet the RBI stipulation.

In percentage terms, State Bank of Travancore had the highest growth in farm credit, at 38.9 per cent, to Rs 1,164 crore.

Allahabad Bank was second with 36.1 per cent rise to Rs 3,063 crore, followed by Punjab National Bank (32.2 per cent), State Bank of Bikaner & Jaipur (29.8 per cent), Andhra Bank (28.5 per cent) and Union Bank of India (24.4 per cent).

In value terms, Punjab National Bank had the highest growth of Rs 2,279 crore in agriculture advances. Industry major State Bank India ranked second with Rs 1,122 crore (7.1 per cent) to Rs 16,993 crore.

Union Bank of India's agriculture advances rose Rs 899 crore. It was followed by Allahabad Bank (Rs 813 crore), Andhra Bank (Rs 464 crore) and Uco Bank (Rs 404 crore).