Wednesday, September 5, 2018

Agricultural Loans Worth Rs 59,000 Crore Went to 615 Accounts in one year

Answer by Govt to an RTI filed by 'The Wire' reveals that Agricultural Loans Worth Rs 59,000 Crore Went to 615 Accounts in one year. That makes a per capita loan of 95 crores to so called Agricultural Institutions at a concessional rate of Interest @4%. Some people asserted that this was unfair and the real beneficiary should always be the end farmers. They thought government was doing something wrong in allowing agriculture loans to big corporate. 

When I read further, I found that these big accounts which received loans are of big agri-business companies e.g. Reliance Fresh who do direct sourcing of farm products and then sell the products. It is easy to say that small farmers should also get easy loans but difficult to recover and get into loan waiver politics. But at the same time I think concessional loans to agri business companies would eventually help the end customers by keeping price down and hence keep food inflation down. So it is not that bad a thing in my opinion.

A cheap loan to anyone part of the whole food supply chain would in the end benefit the end customers by keeping the food prices and food inflation low. 

At the same time one can take note that 'The Wire' has leftist leaning. It was started by an ex-editor of 'The Hindu' (a left-leaning newspaper) and is widely believed to be anti-BJP and anti-Modi. 

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