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EXECUTIVE SUMMARY I. General: a. The Theme of the PLP – 2016-17 is ‘Accelerating the pace of Capital Formation in

agriculture and allied sector’. b. Khargone district is situated in the Malwa Nimar Region in western part of Madhya

Pradesh. It has 09 blocks with a total geographical area of 6542 sq. km. constituting 2.12% of the total area of the State. The average rainfall of the district is 829.90 mm per annum which precipitates in about 73 days. The district population (2011 Census) is 18.73 lakh with 15.74 lakh in rural areas. The opulation below poverty line is 29%%. The Gross Domestic Product (GDP) of the district during 2012-13 was 1.85% of the state GDP. The total irrigated area as a percentage to net sown area is 54.62%. As on 31.3.2015, there were 112 small and tiny Industries, 7 large and medium industries and 03 Mega Industries providing employment to 8822 persons in the district.

c. Ground Level Credit Flow (GLC): Total GLC of the district under priority sector which was ₹1765.12.crore during 2012-13, increased to ₹2099.21 crore during 2013-14 and further to ₹2879.71 crore during 2014-15. The agricultural loans issued during the last three years were ₹1472.49 crore, ₹1750.63 crore and ₹2690.41 crore respectively. The disbursements under NFS (incl. OPS) during the above period were ₹292.62 crore, ₹348.58 crore and ₹189.15 crore respectively. The share of agriculture in GLC which stood at 87.42 % in 2012-13 has increased to 83.42% during 2014-15. The Agriculture Term Loan constituted 4.00% of the total agriculture lending during 2014-15. This share has decreased by 0.22% since 2012-13. The share of CB, RRB and Cooperative is 15.68%, 73.68% and 10.48% respectevley in respect of achievement in Short Term credit during the year 2014-15. The share of CB, RRB and Cooperative is 92.37%, 2.90% and 4.73% respectevley in respect of achievement in Agriculture Term Loan during the year 2014-15.

d. Highlights of banking benchmarks: The district has bank branches with 70 branches of Commercial Banks, 26 branches of Gramin Bank, 39 branches of DCCB, and 129 PACS. The performance of banks in achieving the parameters stipulated by RBI was satisfactory under Priority Sector Advances such as CD ratio of 119.70%, PSA advances of 94.30%, Agricultural Advances of 72%, as against the stipulation of 60%, 40% and 18% respectively. Submission of LBRs by banks was satisfactory at 92% however most of the time the data is not sent in LBR format. Achievement under ACP 2014-15 at ₹2879.71 crore formed 113.32 % of the target. The performance under Financial Inclusion was also satisfactory, as the targets regarding coverage of villages through USB, appointment of BCs, number of transactions of BCs, etc., were achieved as reported by the Banks.

e. Sectoral assessment of potential : (i) The potential, under Priority Sector, in each sector / sub sector for 2016-17 that could be tapped with institutional credit has been assessed and presented in Appendix a and Appendix b to Annexure I. The potential has been assessed at ₹4363.39 crore as against ₹3240.00 crore for the year 2015-16 showing 34.67% growth over previous year. The potential under various sectors include crop loans ₹2586.79 crore, investment credit for agriculture comprising various sectors viz., Water Resources, Farm Mechanisation, Forestry, Dairy Development, Poultry, Sheep/goat/piggery, Fisheries, Storage Godowns & Market Yards and Other activities at ₹986.26 crore, MSME ₹488.37 crore and OPS ₹301.96 crore. The shares of crop loan, agriculture term loan, MSME & OPS are be 59.28%, 22.60%, 11.19% and 6.93% respectively. The share of Agri Term Loans to total agriculture credit is 38.13%. The potential has been assessed keeping in view the GoI/GoMP’s priorities, existing/likely improvements in infrastructure, past GLC, revision in SoF/Unit Cost and various subsidy schemes of GoI/GoMP.

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f. Some of the major constraints envisaged in achieving the potential assessed are banks are reluctuant to give term loans due to increasing NPAs, farmers are not willing to shift for advanced farming and not interested to take investment credit for Agriculture activity etc. Implementation of Vision 2018 document of GoMP would go a long way in realizing the potentials assessed.

II. Thrust areas and Developmental Initiatives of NABARD a. In order to realise the theme envisaged in the document, viz., accelerating the pace of

Capital Formation in Agriculture and Allied sector, a few Area Based Schemes have been identified. The sectors identified are Dairy Development, horticulture and plantation development etc. Tentative banking plans have been prepared for these activities. Area development schemes have been prepared by some of the banks. The models indicated are only pilots and it is expected that more such schemes will be prepared by banks.

b. NABARD had also identified a few thrust areas for 2015-16 viz., JLG/SHG financing, micro warehousing, improving dairy development, Producer Organizations, etc. To promote the above areas, NABARD has also initiated several developmental activities in the form of support to Self Help/JLG Promoting Institutions, conduct of workshops, seminars, training camps, support to farmers clubs, FPOs, farm productivity improvement schemes, Natural Resource Management through Watershed, loan based training for NFS development, etc.

III. Infrastructure a. The district fares well under some of the infrastructure indicators such as road density

etc where the ranking of the district is better than the State average. However certain other indicators such as less irrigated area, more poverty rate etc are inferior to the State average. Incidence of poverty is higher than State average. Infrastructure facilities act as catalysts for development. Under RIDF, 124 projects with a cumulative loan component of ₹501.24 crore was sanctioned by NABARD for the district covering mainly irrigation, roads, public health centres, schools etc projects.

b. In order to improve the credit off-take in the district, the State Govt may consider improving the various critical infrastructure identified in the district viz., setting up of soil-testing laboratories in each block, strengthening the existing extension network, technology transfer, improving irrigation, popularisation of improved agricultural implements and machinery through demonstrations in farmers' fields, popularizing high density cropping systems, improving animal health care, activating/increasing the milk routes, establishment of poultry/fish hatcheries, establishment of fish markets, improving road network, uninterrupted power supply to the industries, etc.

c. There are certain critical infrastructure which can be supported through private investment in the district viz., setting up of warehouses, micro warehouses, cold storages/cold chains, etc. Banks have to play an active role in financing such investments.

IV. Conclusion: In order to achieve the overall credit potential assessed and in particular to enhance the capital formation in Agriculture in the district, there is a need to have a coordinated approach by all the stakeholders, viz., banks, Govt. Departments and NGOs. The reporting system by banks through LBRs, regular monitoring of achievements vis-à-vis the targets in DLCC/BLBC meetings assume greater importance. The implementation of SHG, JLG, RuPay enabled KCC and Financial Inclusion drive will ultimately result in achieving the various objectives of inclusive growth in the rural areas of the district.

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Appendix A to Annexure 1

Broad Sector wise PLP projections - 2016-17 ( ₹ Lakh)

Sr No Particulars PLP projections 2016-17

A Farm Credit

i Crop production, maintenance and marketing 258679.20

ii Term loan for agriculture and allied activities 81513.31

Sub total 340192.51

B Agriculture Infrastructure 13321.06

C Ancillary Activities 3791.70

I Credit potential for agriculture 357305.27

II Micro small and medium enterprise 48837.50

III Export credit 0.00

IV Education 1278.00

V Housing 9132.00

VI Renewal Energy 938.93

VII Others 15487.65

VIII Social Infrastructure involving bank credit 3360.00

Total priority sector ( I to VIII)

436339.35

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Appendix B to Annexure 1

Summary of Sector/Sub Sector wise PLP projections - 2016-17 ( ₹ Lakh)

Sr No Particulars PLP projections 2016-17

I Credit potential for agriculture

A Farm credit

i Crop production, maintenance and marketing 258679.20

ii Water resources 50598.77

iii Farm mechanization 10014.20

iv Plantation and horticulture 4822.00

v Forestry and Wasteland Development 486.23

vi Animal Husbandry-Dairy 11642.25

vii Animal Husbandry-Poultry 263.25

vii Animal Husbandry-Sheep, goat, piggery 889.29

ix Fisheries 709.32

x Others-Bullock, Bullock cart 2088.00

Sub Total 340192.51

B Agriculture Infrastructure

i Construction of storage facilities (warehouse, cold storage) 9858.75

ii Land Development, soil conservation, watershed development

2407.51

iii Others( Tissue culture, Seed production, bio pesticide/fertilizer, vermin compost)

1054.80

Sub total 13321.06

C Ancilliary activites

i Food and agro processing 2810.70

ii Others ( Loans to agriclinincs/agri business center) 981.00

Sub total 3791.70

Total agriculture 357305.27

II Micro, small and medium enterprise

i MSME-Working capital 15947.00

ii MSME-Investment credit 32890.50

Total MSME 48837.50

III Export credit 0.00

IV Education 1278.00

V Housing 9132.00

VI Renewal Energy 938.93

VII Others ( Loans to SHG/JLG, PMJDY) 15487.65

VIII Social Infrastructure involving bank credit 3360.00

Total Priority Sector 436339.35

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BROAD SECTOR-WISE PLP PROJECTIONS – 2016-17

DISTRICT MAP OF KHARGOAN

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