Hyderabad: Andhra Pradesh finance officials have been surprised to learn that farmers have taken more agricultural loans on gold.
According to official records, up to March 31, 2014, farmers have taken Rs 34,888.47 crore loans on gold while Rs 25,784.34 crore was taken as crop loans. However, the farmers have fewer bank accounts on gold loans — 41,30,027 — than crop loans — 43,95,056.
In their review meetings, officials also noticed that a majority of the loans, particularly on gold, were taken by farmers after January 2014.
They say that the reason for this is that the interest rates on agriculture loans are less than other loans.
Another reason for the rising number of loans was Chief Minister N. Chandrababu Naidu’s election promise of waiving off all farm loans after coming to power.
A finance department official said, “If we go through the amount of loans taken by farmers and their bank accounts, and when loans were taken, we can say that they took loans in the name of agriculture, but used it for other activities.”
A recent letter from State Level Bankers Committee (SLBC) convenor, C. Doraswamy, to the state government proves that farmers took loans in the name of agriculture and used it for other purposes. Mr Doraswamy, in his letter had stated that the farmers were not repaying the loans they had taken for purposes other then agriculture activities.
The officials also noticed some irregularities in the farm loans. In a bank in Prakasam district, 80 per cent of agriculture loans were found to be bogus. And in Kurnool district, a single family had taken Rs 4 crore from one bank in the name of agriculture.
A member of the P. Kotaiah Committee said that after Mr Chandrababu Naidu’s announcement on waiver of farm loans, farmers had taken loans unrestrainedly though the agricultural activities were over.
The AP government feels that there will be many bogus accounts in the name of agriculture. To weed out the bogus farm loans, the government has decided to link the farm loans with Aadhaar cards.
Acting on the government’s request, the leading bank in the state, Andhra Bank, has sent circulars to all its branches to collect Aadhaar card details from the farmers.
