Make farm loans cheaper, include more items in MSP: Punjab CM

New Delhi, May 29 | Updated: May 30 2007, 05:31am hrs
Punjab government on Tuesday asked the Centre to make farm loans cheaper and announce minimum support price(MSP) for more commodities such as maize and oilseeds.

Addressing the National Development Council (NDC) meeting here, state chief minister Prakash Singh Badal said interest on crop loans should be reduced to 5% from the current 7% to reduce burden on farmers. For this, the Centre should provide an additional subvention of 2%.

Observing the country's high economic growth had not helped small farmers, he said such peasants should have more access to loans and they be given capital subsidy as was being extended under National Horticulture Mission. He also demanded that NABARD should increase refinance of short term farm loans from 40 % to 70 % to enable cooperative banks to provide more agricultural credit.

"In case where short term agriculture loan is converted into medium term loans due to damage to the crops exceeding 50% on account of natural calamities, the government should provide interest waiver to the farmers," he added.

Badal said although minimum support price (MSP) had been fixed for many crops, yet the procurement was effective in case of only wheat and rice. "At least maize, pulses and oilseeds should be added to this list and their marketing should be efficient as that of rice and wheat to increase area under these crops," he said.A Price Stabilisation Fund should be set up at the national level for crops prone to price fluctuations, he said.

Badal also asked the Centre to designate Punjab as a special category state for funding irrigation programmes in view of its depleting water table. He also said his government did not favour corporate farming as this could lead to alienation of farmers.