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POLITICAL UNREST

Defaulted farm loans rise by 21pc

AKM Zamir Uddin

A farmer carries harvested paddy at a village on the outskirts of Dhaka last week. The defaulted loans in the agriculture sector increased by 21.50 per cent in the last one year as farmers failed to repay their loans for not getting fair prices of their produce due to a supply chain disruption amid political unrest. â Sony RamanyA farmer carries harvested paddy at a village on the outskirts of Dhaka last week. The defaulted loans in the agriculture sector increased by 21.50 per cent in the last one year as farmers failed to repay their loans for not getting fair prices of their produce due to a supply chain disruption amid political unrest. â Sony Ramany

The defaulted loans in the agriculture sector increased by 21.50 per cent in the last one year as farmers failed to repay their loans for not getting fair prices of their produce due to a supply chain disruption amid political unrest.
According to the BB data released on Thursday, the defaulted loans in the farm sector rose to Tk 6,208.35 crore as of November 30, 2013 from Tk 5,109.57 crore as of November 30, 2012.
The data showed the overdue loans in the sector also rose by 22.01 per cent in the last one year.
A large number of farmers failed to repay their loans in the period as they counted losses for failure in supplying their products to upazila and district headquarters and to metropolitan cities due to frequent blockades and hartals called by the opposition political parties in the last few months, a BB official told New Age. The farm sector defaulted loans accounted for 19.78 per cent of the total loans (Tk 31,380.48 crore) disbursed in the sector as of November 30 this year.
The classified loans in the sector were 18.40 per cent of the total loans (Tk 27,775.58 crore) disbursed as of November 30 last year.
Six state-run banks — Sonali, Janata, Agrani, Rupali, Bangladesh Krishi and Rajshahi Krishi Unnayan banks — held the majority of the defaulted farm loans.
The farm sector defaulted loans in the six state-run banks increased by 21.08 per cent to Tk 6,127.51 crore as of November 30, 2013 from Tk 5,060.59 crore as of November 30, 2012.
The farm sector defaulted loans in the six banks stood at 23.97 per cent of the total loans amounting to Tk 25,207.20 crore disbursed by the banks to the sector as of November 30, 2013.
The agriculture sector defaulted loans in the private and foreign commercial banks increased by 65.04 per cent to Tk 80.84 crore as of November 30, 2013 from Tk 48.98 crore as of November 30, 2102.
The sector’s defaulted loans in the PCBs and the FCBs stood at 1.39 per cent of their total loans amounting to Tk 5,822.09 crore disbursed to the sector as of November 30, 2013.
The BB official told New Age on Thursday that the state-run banks held larger amount of the agriculture defaulted loans than those of the PCBs and the FCBs as the state-run banks usually disburse the majority of the agriculture loans in the banking sector.
The BB official said that the defaulted loan in the agriculture sector would increase further in the coming months if the political unrest persists.
Prices of the majority of the farm products declined significantly at the upazila level in the last few months as the farmers failed to supply the products to the district headquarters and the metropolitan cities due to a setback in the transportation system amid the ongoing political violence, he said.
Under the circumstances, the overdue loans in the agriculture sector also increased in the period, he said.
The BB data showed the overdue loans in the agriculture sector rose to Tk 7,635.03 crore as of November 30, 2013 from Tk 6,257.30 crore as of November 30, 2012.
The BB official said that the overdue loans would turn into defaulted ones if the political parties continue to call blockades and hartals in the coming months.




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