Imperialism- New Faces

to small farmers, the Reserve Bank had decided in April 1971 to earmark a part of the short-term credit limit sanctioned to a central co-operative bank specifically for financing "small and economically weak farmers'', defined as those having land holdings upto 3 acres. To start with, the central cooperative banks were required to show at least 10 per cent of their outstanding borrowings from the state co-operative bank as covered by outstandings of short-term agricultural loans to primary societies against small and economically weak farmers. In 1971-72 the proportion was raised to 20 per cent. As a further measure to ensure compliance, the Reserve Bank decided that only a part of the borrowing limit sanctioned to a central co-operative bank would be treated as 'free', the balance being drawable only after the bank had fulfilled the condition with regard to financing of small and economically weak farmers. The 'free' portion of the sanctioned borrowing limit was fixed at 80 per cent for 1972-73. It was lowered to 70 per cent for 1973-74 and further to 60 per cent for 1974-75. As an incentive to co-operative societies to finance small farmers, the Maharashtra government has also been making outright grants to the special bad debts reserves of the central co-operative banks and the primary societies. The aggregate of such grants stood at Rs 1.24 crores at the end of June 1973.