The fourth budget of the NDA govt is being held as rural centric but for cooperatives it has been a mixed bag. Though the issue of amendment in 43D has benefitted a majority of urban cooperative banks, the hint of amending the MSCS Act 2002 in near future has also spooked them.
The issue of passing of the Banning Bill is also keeping the cooperative sector on tenterhooks. No word on fertilizer has again disappointed the cooperatives like IFFCO and Kribhco that are acknowledged leaders in the fertilizer sector.
However there is a general thrust towards the farm sector which has been welcomed by cooperative leaders. Presenting the Budget in Parliament on Wednesday, the Union Finance Minister Arun Jaitley said adequate credit would be made available to the farmers in time and the target for agricultural credit in 2017-18 has been fixed at a record level of 10 lakh crore.
He said special efforts would be made to ensure adequate flow of credit to the under- serviced areas such as Eastern States and Jammu & Kashmir. Jaitley said about 40% of the small and marginal farmers avail themselves of credit from the cooperative structure and therefore the Government is committed to support NABARD on computerization and integration of all 63,000 functional Primary Agriculture Credit Societies (PACS) with the Core Banking System of District Central Cooperative Banks.
This will be done in 3 years at an estimated cost of Rs 1,900 crore, with financial participation from the State Governments to ensure a seamless flow of credit to small and marginal farmers.
Elaborating on a rash of pro-farmer measures, the Finance Minister said a Long Term Irrigation Fund has already been set-up in NABARD and the Prime Minister has announced additional Rs 20,000 crores to its corpus which will spike the fund to Rs 40,000 level.
The coverage of Fasal Bima Yojana will be increased from 30% of cropped area in 2016-17 to 40% in 2017-18 and 50% in 2018-19. The Finance Minister Jaitley said the Budget provision of `Rs. 5,500 crore for this Yojana in BE 2016-17 was increased to Rs. 13,240 crore in RE 2016-17 to settle the arrear claims. For 2017-18, a sum of Rs 9,000 crores will be provided and the sum insured under this Yojana has more than doubled from Rs 69,000 crore in Kharif 2015 to Rs 1,41,625 crore in Kharif 2016.
The coverage of National Agricultural Market (e-NAM) will be expanded from the current 250 markets to 585 APMCs. Moreover, assistance up to a ceiling of Rs 75 lakh will be provided to every e-NAM market for the establishment of cleaning, grading and packaging facilities.
The Minister also announced that a Dairy Processing and Infrastructure Development Fund would be set-up in NABARD with a corpus of Rs 8,000 crore over 3 years.
He said issuance of Soil Health Cards has gathered momentum even as the Government has decided to set-up new mini labs in Krishi Vigyan Kendras (KVKs) and ensure 100% coverage of all 648 KVKs in the country.