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RIL MoU with Gujarat to mechanisation in India comparable to are small and marginal and they can-
advanced economies, industry repre- not access tractors that are priced at
invest Rs. 5.95-lakh cr in sentatives say. Rs. 6-7 lakh. These small farmers need

renewable energy A recent RBI report pointed out that affordable solutions in the area of
Reliance Industries Ltd (RIL) signed the extent of farm mechanisation in power tillers, rice transplanters, etc.
MoU on January 13 with the Govern- India has increased over the years and "Product innovation should happen in
ment of Gujarat for a total investment the current level of farm this area . We need Indiaspecific, af-
of Rs 5.955 lakh crore as part of Invest- mechanisation is estimated at 40-45 fordable small farm machinery suitable
ment Promotion Activity for Vibrant per cent. But, it is much lower com- for these small farmers,"
Gujarat Summit 2022. These projects pared to other advanced economies addedCherukara.
will create 10 lakh direct / indirect and the BRICS countries such as the US Farm mechanisation has the potential
employment opportunities in the State. (95 per cent), Western Europe (95 per to enhance agricultural productivity by

To make Gujarat net zero and carbon cent), Russia (80 per cent), Brazil (75 30% and reduce the input cost by 20%
free, RIL proposes to invest Rs 5 lakh per cent) and China (48 per cent). To increase penetration, the
crore in the State over the span of 10 Although the density of tractors has government's support by way of retail
to 15 years to set up 100 GW Renew- increased substantially over the years, finance is described as a major factor.
able Energy Power Plant and Green the market for other farm equipment
There should be specific targets given
Hydrogen Eco-System development. including power tillers, rotavator and to the banks by the Nabard for fund-
RIL will develop an eco-system for as- transplanters is still limited and much ing small farm machinery, not trac-
sisting Small and Medium Enterprises unorganised (15 per cent of the farm
tors, by small and marginal farmers.
and encourage entrepreneurs to em- equipment market).
brace new technologies and innova- Farm mechanisation has the potential Under priority sector lending (PSL),
tions leading to captive use of Renew- to enhance agricultural productivity by loans are extended to agri
able Energy and Green Hydrogen. 30 per cent and reduce the input cost mechanisation. Banks wouldn't know
by 20 per cent. the details about the equipment. So,
Product innovation, avail- most of the retail loans are availed by
"What we have so far seen is the medium and rich farmers for buy-
ability of retail finance to tractorisation, not farm mechanisation ing tractors. "Hence, the government
drive farm mechanisation in the country,'' said Antony Cherukara, must fix a target under PSL to sell small
CEO, VST Tillers Tractors Ltd, a leading
Product innovation and retail finance farm equipment other than tractors.
player in the small farm machinery
support through government push in This will definitely give a big boost to
sector.
the small farm machinery segment will farm mechanisation in the country," he
drive higher levels of farm About 70 per cent of Indian farmers said.

BANKING FINANCE | APRIL | 2022 | 11