The New Nation - Internet Edition

Staff Reporter

About 80 percent people live in the rural areas of Bangladesh but they get less than 10 percent of bank loans. Banks and other financial institutions show little interest to the agri-people. Banks are reluctant to give loans to any individual or group of individuals or institutions without obtaining securities of sufficient amount.

During the time of late President Ziaur Rahman,. the government instructed the nationalised commercial banks (NCBs) to disburse loans, even to the marginal and the landless farmers, on deposit of parcha, DCR and rent receipt and the third party guarantee. The scheme became highly useful. Later different commercial banks introduced banana and fishery loan.

The economy of Bangladesh is still agriculture based. Sixty-two percents of the workforce are involved in agriculture. Its contribution to GDP is still 20 percent but the flow of loan in the rural areas is around 9 percent. Even the deposits the banks collect from rural people are not fully used for them. One of the causes of their apathy may b that the rate of interest in the agricultural loan is 8 percent.

Banks and financial institutions claim that agricultural loan is more risky. The private commercial banks (PCBs) appear lethargy in sanctioning loans to the rural people. Although they control 60 percent of the total deposits, they have so far disbursed taka 967 crore as agricultural loan out of taka14,670 crore. And their portion in agri-based industrial loan, is taka 3900 crore out of taka 10,577 crore.

In Bangladesh, the number of the landless farmers has been increasing day by day. The marginal peasants take loan from the moneylenders at high rate of interest. Failing to repay the loan due to drought or excessive rains or floods or other natural calamities, they lose the lands to the moneylenders and thus become landless. Nowadays it has been very hard for the peasants to buy new land after meeting all kinds of expenditures relating to cultivation and paying back the loan.

That does not mean that the government should sit idle after instructing banks to sanction loans and to allocate subsidy in agriculture. If the subsidy is not properly distributed or if the fake farmers in collusion with the unscrupulous men in the administration and the DAO grab it, not only the production will be hit, the number of the landless farmers will continue to increase.