RPCD.PLFS.BC.No. 28 /05.01.14/2001-02 September 22, 2001 The Chairman/Managing Director/Chief Executive Officer
All Scheduled Commercial Banks
(excluding Regional Rural Banks) Dear Sir Scheme for Financing Farmers for Purchase of
Land for Agricultural Purpose – Classification Please refer to NABARD’s circular No.DPD.FS./15/2001-02 dated 20 August, 2001, forwarding therewith the guidelines on Financing for Purchase of Land for Agricultural Purpose. 2. It has been decided that finance granted by banks under the above scheme shall be eligible for classification under "Direct – Agriculture" under "Priority Sector Advances" subject to the following conditions: - The loans are granted to share croppers, tenant farmers, small and marginal farmers i.e. who own maximum of 5 acres of non-irrigated land or 2 ½ acres of irrigated land including proposed area of land to be purchased.
- The purchase of land should not be in fragmented holdings and there should be resultant increase in production/productivity.
- The purchase of land should be for cultivation/development of agricultural as well as fallow land or for establishing/diversifying into other allied activities. Banks should ascertain the end use of funds.
3. You may also note to classify the above advances under "Direct Agricultural Advances" in the half-yearly statements on priority sector lending. 4. Please acknowledge receipt. Yours faithfully (Smt. Vani J. Sharma)
Chief General Manager |