Farm loan rates may be cut

Agriculture Minister Sharad Pawar has called a meeting of all state-level banks and cooperative banks to discuss the issue of reduction of interest rates on loans taken by farmers, the Lok Sabha was informed on Monday.

"I have called a meeting of all cooperative banks and state-level banks for farmers as the interest rate on loans for them is 12 to 13 per cent while the interest for car loans is only seven to eight per cent which is an injustice," Pawar said.

Commercial banks, however, have begun to reduce the interest rate on loans taken by farmers while cooperative banks would be unable to reduce the interest rate for at least two to three years as it will take time for them to return deposits, he said.

To a question whether the Centre has made any arrangement to purchase crops to stabilise prices, Pawar said "The government has not made any arrangements to purchase onion."

He said onion has been withdrawn from the list of essential commodities with effect from 2004-2005 so as to facilitate free trade and marketing of onion, which, in turn, would encourage farmers for taking up production for domestic consumption as well as exports.

Pawar said onion exports could touch a record high of about 10 lakh metric tonnes as 5,98,000 metric tonnes onion exports were registered till November 24.