Friday, February 13, 2009

Barley, Interest rates

1. Barley, a key ingredient for brewing beer promises to be a big opportunity to the farmers in Rajasthan. Companies like Pepsico and SABmiller are partnering with farmers for the supply of barley.

PepsiCo had signed a three-year memorandum of understanding (MoU) with more than 1,200 farmers from Sriganganagar and Hanumangarh districts of Rajasthan to produce high yielding malt barley for the United Breweries group (UB).

SABMiller India sources its barley from Rajasthan and Haryana. While it has a contract farming agreement with HAFED, in Rajasthan, it has a barley project called 'Sanjhi Unnati', for which it has tied up with an NGO, Morarka Foundation.

(source: Times of India)

2. Farmers are not benefiting with the lowering of interest rates. Agriculture cooperative banks and regional rural banks are forced to continue with the high interest rates while offering investment credit for agriculture development and allied activities. These banks offer agriculture investment credit at an interest rate band of 11-to-13% a year. The ticket size of their investment loans are typically less than Rs 50,000. By contrast, agriculture investment loans below Rs 50,000 from public sector banks these days are available at 8.5-9.5% per annum rates.

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