The money will be disbursed to cultivators through farm cooperatives. Photograph:( Reuters )
The government has allowed the National Bank for Agriculture and Rural Development (NABARD), a state-run lender, to disburse 210 billion rupees ($3.07 billion) to farmers to help them sow winter crops such as wheat, a top finance ministry official told reporters on Wednesday.
Shaktikanta Das, economic affairs secretary, said NABARD will disburse the money through farm cooperatives.
Prime Minister Narendra Modi`s shock move to cancel 500 and 1,000 rupee banknotes as legal tender has left millions of farmers with little cash to buy seeds and fertilisers for winter crops, threatening production of key commodities and hurting rural communities that were only just recovering after two years of drought.
Small farmers get 40 percent of their credit from cooperative banks, Das said.