Ceiling for interest-free loans to farmers increased from ₹3 lakh to ₹5 lakh

Size of revolving fund for procurement under MSP increased to a record ₹3,500 crore

February 17, 2023 12:45 pm | Updated 01:11 pm IST - BENGALURU

The Karnataka government will encourage farmers to construct ponds in their own land by converging with MGNREGA scheme.

The Karnataka government will encourage farmers to construct ponds in their own land by converging with MGNREGA scheme. | Photo Credit: SRIRAM MA

The budget presented by Karnataka Chief Minister Basavaraj Bommai proposes to increase the ceiling on interest-free loans being given to farmers from ₹3 lakh to ₹5 lakh. The budget has earmarked ₹25,000 crore for disbursal to the agricultural sector in the coming financial year at zero interest. This is expected to benefit around 30 lakh farmers.

In addition, the CM proposed increasing size of the revolving fund — meant for market intervention during times of a price crash through procurement of foodgrain under MSP scheme — from ₹2,000 crore to ₹3,500 crore. “This is the highest quantum of revolving fund in the history of the State dedicated for MSP operations,” according to the CM.

The budget offers an additional subsidy of ₹10,000 under Bhoo Siri scheme for Kisan Credit Card holders. This would help farmers purchase farm inputs like seeds, fertilisers, and pesticides in times of exigencies. Of the subsidy of ₹10,000, the State will contribute ₹2,500 while NABARD will provide the remaining ₹7,500. In all, the scheme is expected to benefit around 50 lakh farmers in the coming financial year.

The budget has an interest subvention scheme for loans up to ₹10 lakh taken through banks for a term of five years for the better performing Farmer Producers Organisations under the Mukhyamanthri Raitha Unnathi Yojane.

The budget has two new schemes for conservation of water at a cost of ₹75 crore. They provide for development of 1,000 lakes under Sahasra Sarovara scheme, and development of wells, check dams and canals in coastal, Malnad and Semi-Malnad areas under Sahyadri Siri project.

It has a new scheme Jalanidhi to improve the groundwater level through building farm ponds in farmers’ lands. Under this, farmers will be encouraged to construct ponds in their own land by converging with MGNREGA scheme.

A new scheme titled Raitha Sampada has been announced to promote processing and export of agricultural and horticultural produce at a cost of ₹100 crore through Karnataka State Agricultural Produce Processing and Export Corporation.

The CM announced a new horticulture college in Tiptur in Tumakuru district. It provides a grant of ₹100 crore to Karnataka Grapes and Wine Board to help grape growers in various activities.

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