Mon Jun 02 05:00:21 UTC 2025: Here’s a news article summarizing the information, suitable for a publication like “Karnataka Today” from The Hindu:
**Karnataka Facing Potential Farmer Loan Shortage, MLC Urges Government Action**
**BENGALURU, June 2, 2025** – Karnataka’s agricultural sector could face a significant setback as funding for farmer loans is potentially at risk. Congress MLC Dinesh Gooli Gowda is urging the state government to cover a higher interest rate demanded by the National Bank for Agriculture and Rural Development (NABARD) to ensure adequate lending to farmers.
NABARD, which provided ₹5,450 crore to the State Apex Bank at a 4% interest rate in 2024-25, has limited the loan amount to ₹2,700 crore for 2025-26 at the same interest. While Karnataka aims to distribute ₹28,000 crore in credit to 37 lakh farmers in 2025-26, this funding limitation poses a serious challenge.
Gowda stated that NABARD is willing to provide additional loans but will charge a higher interest rate of 8.25%. He has appealed to Chief Minister Siddaramaiah, Deputy CM D. K. Shivakumar, and Cooperation Minister K.N. Rajanna to cover the additional 4.25% interest on behalf of the State Apex Bank. This would allow District Central Cooperative (DCC) banks and Primary Agricultural Cooperative Societies (PACS) to continue providing essential services and loans to farmers.
In a letter to state leaders, the MLC warned that without this intervention, the State Apex Bank and DCC banks could face a capital shortage, hindering their ability to distribute loans for the upcoming kharif season. This could lead to decreased borrowing by farmers and potentially jeopardize the state’s targeted foodgrain production of 160.74 lakh tonnes for 2025-26.
The government has yet to respond publicly to Gowda’s request.
First Piper 