State food processing minister Mohanta Chatterjee (second from left) in Calcutta on Tuesday. Picture by Kishor Roy Chowdhury

Calcutta, Nov. 20: Bengal needs around Rs 15,000-crore credit annually in agriculture but manages to get only Rs 2,300 crore from banks and financial institutions. The rest comes from the unorganised sector.

“It is easier to get a loan for a car or a house than for a tractor or any other cultivation inputs without collateral. A lot of it has to do with mindset. Maybe the default rate in house and car loans is greater but agriculture bears the brunt,” said Sanjeev Chopra, principal secretary in Bengal’s agriculture department.

Chopra was speaking at a seminar on rural India organised by the Confederation of Indian Industry.

The Bengal government had said it would try to raise organised sector loans to Rs 3,500-4000 crore and eventually take it to Rs 10,000 crore.

“If agriculture does not get more credit, allied sectors such as food processing cannot realise its full potential,” said Bengal food processing minister Mohanta Chatterjee.

According to a survey by the Centre, Bengal has potential to attract Rs 15,451.80 crore in food processing over the next 10 years.

However, more primary farm credit societies may help solve the problem of credit. There are 18,796 such societies in Bengal, with 1.79 crore farmers having memberships, the highest in India.

The state is followed by Kerala and Maharashtra, with memberships of 1.11 crore and 1.06 crore, respectively.

The State Bank is targeting agricultural advances of over Rs 40,000 crore by the end of March 2008 against Rs 34,993 crore in March 2007 — a growth of over 14 per cent.

Nationally, the share of the bank’s agriculture advances to total advances has increased from 12 per cent in March 2004 to 15 per cent in June 2007.

The volume of farmlending by co-operative banks during 2002-03 stood at Rs 23,716 crore. This jumped 60 per cent to Rs 39,404 crore in 2005-06, RBI figures said. However, most of the credit went to big farmers.

During this period, credit from gramin banks grew 250 per cent.