Thought to Action

Agriculture Secretary RCA Jain(L) being felicitated by SujoyGhosh of TimesGroup

‘Challenges in transforming subsistence agriculture to sustainable enterprise’ was the leitmotif of a high-powered seminar organised by the Times Agriculture Journal (TAJ) and the National Bank for Agriculture and Rural Development (Nabard) on June 13. The meet, attended by a battery of thinkers and industry leaders, was an extension of the TAJ’s mission of bringing the industry together on a common dais.

The panelists at the first session

The key themes that dominated the proceedings over the two sessions spanning the day, were: Agriculture credit and agriculture as a sustainable enterprise. The first session was flagged off with a welcome address by Sujoy Ghosh, General Manager, Response, The Times of India. He said, “The action taken today will develop the path agriculture will take in the future.” He also promised the august gathering better articles and extensive coverage of various topical issues in the upcoming issues of TAJ.

SBI's MA Krishna (L) in conversation with Sridhar(R) of Exim Bank

RCA Jain, Secretary, Union Ministry of Agriculture, and YC Nanda, Chairman, Nabard, shared their vision for the sector and set the tone for the day. Mr Nanda, in his inaugural address, discussed the capacities and requirements of the rural credit system and openly acknowledged “the kind of

IDS'VS Vyas addressing the gathering

focus that should have gone into agriculture credit has not happened and much more effort is required from the financial institutions”. Delivering the keynote address, Mr Jain urged the private sector to provide assistance to the Government in its endeavour to promote the agriculture sector. He remarked, “The solution lies in improving the viability and the profitability of agriculture.”

What followed was an overview of the trends in the sector and its credit needs. The session, chaired by Vijay S Vyas, Professor Emeritus and Chairman, Institute of Development Studies, Jaipur, presented a diverse perspective on the pertinent issue of agriculture credit. He acknowledged that, “A number of things have to be done to ensure that agriculture gets the dynamism it is capable of.” The perspective of the largest commercial bank was presented by MA Krishnan, Chief General Manager, SBI. He provided a historical background to the issue of agriculture credit. “The period of 1972-85 was the golden era as far as agriculture credit goes. A lot of experiments were carried out in 1985-90, but this was the period when the enthusiasm began to die. And 1990s onwards, concerns about the financial health of the banks began to impinge on the minds of the bankers,” said Mr Krishnan. He also called for an extensively distributed, standardised and digitised Kisan Credit Card (KCC) scheme that would “become a sort of kisan identity and hence enable banks to identify wilful defaulters, and on the other hand facilitate borrowers to obtain credit more easily and obviate the need for no-due certificates”.

Dr Narendar Pani of The Economic Times deliberated on risk management in agriculture. “Among the major reasons for this choice is the need to understand the impact of liberalisation on risk management in agriculture,” he said. According to him, the major sources of risk in farming can be classified according to the various stages of farming. At the very first stage, there is the risk of capital not being available at reasonable rates. Once that is taken care of, there is the risk of inadequate rainfall. Then there is the risk of seeds and other inputs not delivering what they promise. Even if reliable inputs are available, there is the risk that they would not be available at an affordable price. Once the crop is harvested, there is the risk of the market not being able to absorb the crop at a remunerative price.

Elaborating on institutional credit to agriculture – adequacies and efficiencies – AV Sardesai, Executive Director, Reserve Bank of India,  said, “Agriculture constitutes one of the main streams of interest for RBI.” He laid emphasis on the availability of modern farming methods for improving agriculture, but also remarked: “None of these physical inputs can really be put to optimal use unless the most important input, that is, money is also made available appropriately.”

Dr Vijay Vyas, who chaired the first session, said, “Things are not what they were 10 years ago. Indian agriculture is not a static concept and there are changes taking place even at the operational level.” From the perch of one of the most eminent economists in the country, he also predicted: “We will have more small holdings than larger ones.” Answering rhetorical questions as to why the commercial banks were feeling shy to provide credit, he posited three main reasons –...

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