The State Bank of Pakistan set a target of Rs1.7 trillion for agriculture credit disbursement in FY22. It aims to enhance agricultural productivity and facilitate farmers.
Last year, the Central Bank achieved a target of Rs1.4 trillion loan for the agricultural sector that helped to deal with the adverse implications of the pandemic on the farming community and agriculture businesses. The Government had also started a short-term agricultural loan scheme for the farmers to purchase different variable inputs such as certified seeds, fertilizers, pesticides, and modern agricultural equipment.
Being an agro-based developing country, agriculture plays an important role in the economy. The development of agriculture has a direct influence on the improvement of the socio-economic life of rural inhabitants. Loans play an important role in agricultural development by increasing farm productivity and income of the farmers.
The agriculture sector is considered an indispensable part of Pakistan’s economy. Apart from contributing 19% to the national GDP, the sector absorbs 42 per cent of the country’s labour force. However, the agricultural sector, mainly the farmers, are faced with various issues, which have slowed down the sector’s growth and performance. Given the importance of the agricultural sector, the Government is taking further steps to develop agribusiness. The high credit disbursement will enhance farmers’ financial inclusion which will help to boost agricultural yields.
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