To give a shot in the arm to the farm sector, Assam will soon launch a ‘Zero Interest Crop Loan’ scheme for farmers, under which they can borrow up to Rs 1 lakh.
Assam Finance Minister, Himanta Biswa Sarma, stated this while presenting the State’s 2017-18 Budget. He said the proposal was aimed at encouraging farmers to avail loans against the backdrop of low credit flow in the State’s rural regions.
A report appearing in the Business Standard quoted Sarma as saying, “Financial inclusion is the heart of several programmes of our Government. The low credit-deposit ratio in Assam leaves great scope for expansion of credit flow to rural areas, particularly to the farmers. To encourage the uptake of credit by our farmers, we propose to introduce ‘Zero Interest Crop Loans’ by offering 100 per cent interest subvention on agricultural loans up to Rs 1 lakh.”
The report further quoted the minister as saying that “Assam would perhaps be the first State in the country to take such a transformative intervention to drive agricultural loans”. The Budget has allocated a sum of Rs 25 crore for 2017-18 for the scheme.
In his previous Budget, Sarma had announced a massive five-year long rural investment programme of Rs 30,000 crore to double the income of agricultural farmers in the State. Named as the ‘Chief Minister Samagra Gramya Unnayan Yojana (CMSGUY)’, the mission will culminate in the year 2021-22, coinciding with 75 years of Indian independence and is in tandem with the vision of Prime Minister Narendra Modi to double agricultural income.
The Budget also informed of introducing a one-time cash incentive of Rs 3,000 per inactive Kisan Credit Card (KCC) holding farmer if he renews the card. According to records, over 80 per cent of KCC cards are lying inactive which is indicative of the fact that the credit flow from the banks to the farmers is not commensurate with the number of KCC holders. “As KCCs are intrinsically linked to the growth of the agricultural sector, it is important that we revive these inactive cards so that there are strong credit flows in the market. I am looking for creating a positive situation in the field by giving an incentive to the KCC holding farmers which will prompt the banks to give more credit,” said Sarma while allocating a sum of Rs 65 crore in the Budget.
Another major announcement has been to woo the Business Process Outsourcing (BPO) industry. The Government proposed to provide up to 90 per cent of one-time expenditure incurred on the capital support without any upper ceiling. The Budget also proposed to provide 100 per cent reimbursement of stamp/transfer duty and registration fees paid by BPO/IT/ITes on sale or lease deed.
“Perhaps this kind of incentive has not been provided by any other State and even by the Government of India. We felt that a very attractive incentive package is necessary to woo this industry and accordingly our Government proposed this,” said Sarma.
He added, “We also fully appreciate that there exist regional constraints to the BPO industry and hence, substantial incentives need to be given to make Assam an attractive destination for the BPO industry.”
The Budget for 2017-18 is a tax-free one and the Finance Minister could put forth figures which showed handsome growth in tax collection in 2016-17. There has been 16.10 per cent growth in tax collection between April and December 2016 as compared to the corresponding figure of the previous year. Sarma said the increase in tax collection could be achieved by checking leakages in the system. However, the Budget had a deficit of Rs 2,349 crore at the end of the financial year 2017-18.