Pakistan is an agricultural country contributing a significant share of GDP. Agriculture provides food security in our food chain. Due to its substantial share in the economy, this sector needs time to time developments to offer food to the masses. Agriculture provides a major portion of employment directly or indirectly to rural areas. The PM called the agricultural sector “Future of Pakistan”. Loan facilities and subsidiaries to farmers will promote agriculture growth.
State Bank of Pakistan increases the loan limits for farmers after analyzing input values. Credit limits for rice crops have been raised to Rs70,000 per acre for 2022. Five other crops have also seen an increase in loan limit. Indicate credit limits for wheat and cotton have been elevated to Rs60,000 and Rs75,000 per acre, respectively. All prices are set according to per acre. The indicative credit limit nominated for sugarcane and maize is Rs105,000 and Rs65,000 per acre, respectively. The hybrid maize has a received limit of Rs78,000 per acre. Estimation methodology is the technique used for the calculation of this credit limit. These limits will help the bank in the calculation of credit amount according to land for the specific farmer.
These indicative limits will facilitate the banking sector in insurance schemes related to agriculture. Crop Loan Insurance Scheme (CLIS) and its regulation according to variation will facilitate premium claims under this scheme. Statistical analysis will become easy for bankers to avoid any ambiguity related to the production of crops. Banks will be able to calculate the actual need of borrowers, easing the farmer’s difficulty of estimation of credit.
The bank is independent in making changes to loan limits according to the market’s demand and farmers, analyzing the input prices and output rates. Minister for National Food Security and Research Syed Fakhar Imam met with the finance minister and SBP officials for a loan facility to the Agri sector. The minister also stressed the federal and provincial officials for implementing this project to give a realistic picture of the PM idea. Development and transformation of the agriculture sector will provide monetary assistance to raw producers intended to change life standards.
Akhuwat and the National Rural Support Programme (NRSP) contributed a lot in providing loan facilities to needy farmers. Both organizations have distributed Rs63.86 million among 743 poor farmers. The federal government has provided a subsidiary on the mark-up rates of these loans. Kamyab Kissan project also highlights the government’s serious attention to the agriculture sector. The government will provide 50,000 loans with a total value of Rs5 billion.
The federal government authorized the Agriculture Credit Advisory Committee to check and balance agriculture loans projects. Punjab farmers excelled at the opportunity by taking the highest loans. Balochistan borrowers had benefited the least. This loan project will accelerate the agriculture sector by efficiently planning loan utilization.
Pakistan is importing wheat from Ukraine. It is a sad story for Pakistan as an agricultural country. Each year, the government needs to import agricultural products due to poor management of resources.
Source:
https://www.dawn.com/news/1675534/state-bank-raises-agri-credit-limits
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