State bank of india Summer internship Report

10 weeks Research work was conducted on allied agriculture activities in MP state and the outcomes are mentioned in my report.

1. STATE BANK OF INDIA
2017
SUMMER INTERNSHIP
PROJECT REPORT
SCOPE OF FINANCING ALLIED AGRICULTURE
PROJECTS IN M.P STATE
ABHISHEK SHRIVASTAVA
MAULANA AZAD NATIONAL INSTITUTE OF TECHNOLOGY

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PREFACE

Theoretical knowledge without the practical exposure is worth valueless.
Theoretical studies in classroom are not sufficient to understand the
functioning and nature of research. Therefore, it becomes necessary to
undergo any research project work. Practical project supplements the
theoretical studies i.e. it covers what is left uncovered in the classroom.
It exposes the student to invaluable pleasure of experience.


I completed my research project on the topic “SCOPE OF FINANCING
ALLIED AGRICULTURE PROJECTS IN M.P STATE”. During the
research project, I got an opportunity to learn valuable things, which I
could not have been able to learn from theory classes. In order to use
theoretical knowledge, I got an opportunity of doing “10 weeks of
summer internship in State Bank Of India, Regional Business Office”.
The forthcoming pages attempt has been made to present a
comprehensive report concerning different aspects of my research. The
overall gain to me will be reflected in the report itself.


ABHISHEK SHRIVASTAVA

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ACKNOWLEDGEMENT

At the outset, I express my heartfelt thanks and gratitude to those who sincerely
helped and supported me throughout the project I have undertaken to do so and
without whose active support and help it would not have been possible for me to
complete the project. As such, I once again extend my sincere thanks & gratitude
to all of them.
To this effect, at first I take the opportunity to express my profound gratitude and
deep regards to my mentor Mr. Manoj Rastogi (Regional Manager) for his active
guidance and constant supervision together with time to time providing with
necessary information connected with the project following active support in
completing the project.
I also take the opportunity to express my heartfelt gratitude to Dr. Verma
(Assistant Professor),for extending his cordial support, providing valuable
information and guidance, which helped me a lot in completing the task at various
stages.

Moreover, I would also like to express my heartfelt gratitude to the agricultural
officers and chief managers of State bank of India, for their kind co-operation and
necessary encouragement which also helped me a lot in completing the project.
Finally, I would like to express my earnest gratitude to my friends and family
members for their constant support and encouragement without which the
assignment would not have been completed, besides the constant blessings of
almighty.

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TABLE OF CONTENT

TOPIC PAGE
NO.
CHAPTER 1: INTRODUCTION OF THE STATE BANK OF INDIA
 INTRODUCTION
 HISTORY
 MISSION,VISION,VALUES
 ORGANISATIONAL STRUCTUR E
5-10


CHAPTER 2: LITERATURE REVIEW 11-12
CHAPTER 3 : INTRODCUTION OF THE PROJECT
 INTRODUCTION ABOUT THE EXISTING SCENARIO
 DYNAMICS OF INDIAN AGRICULTURE
 PAST AND EXISTING TRENDS
 FISHERIS
 DAIRY
 SERICULTURE
 APICULTURE
 AGRICULTURAL CREDIT

13-26
CHAPTER 4: RESEARCH METHODOLOGY
 RESEARCH DESIGN
 OBJECTIVES
 LIMITATIONS OF THE STUDY

27-28
CHAPTER 5: DATA ANALYSIS
 DATA INTERPRETATION AND RESPONSES

29-40
CHAPTER 6: RECOMMENDATIONS & SUGGESTIONS, CONCLUSION

41-43
CHAPTER 7 : ANNEXURE 44-47
CHAPTER 8: BIBLIOGRAPHY 48

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INTRODUCTION
STATE BANK OF INDIA

State Bank of India (SBI) is an Indian multinational, public sector banking and
financial services company. It is a government-owned corporation with its
headquarters in Mumbai, Maharashtra. On 1st April, 2017, State Bank of India, which
is India's largest Bank merged with five of its Associate Banks (State Bank of Bikaner
& Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and
State Bank of Travancore) and Bharatiya Mahila Bank with itself. This is the first ever
large scale consolidation in the Indian Banking Industry. With the merger, State Bank
of India will enter the league of top 50 global banks with a balance sheet size of 33
trillion, 278,000 employees, 420 million customers, and more than 24,000 branches
and 59,000 ATMs. SBI's market share will increase to 22 percent from 17 per cent. It
has 198 offices in 37 countries; 301 correspondents in 72 countries. The company is
ranked 232nd on the Fortune Global 500 list of the world's biggest corporations as of
2016.

The bank traces its ancestry to British India, through the Imperial Bank of India, to the
founding, in 1806, of the Bank of Calcutta, making it the oldest commercial bank in
the Indian subcontinent. Bank of Madras merged into the other two "presidency
banks" in British India, Bank of Calcutta and Bank of Bombay, to form the Imperial
Bank of India, which in turn became the State Bank of India in 1955. Government of
India owned the Imperial Bank of India in 1955, with Reserve Bank of India (India's
Central Bank) taking a 60% stake, and renamed it the State Bank of India. In 2008, the
government took over the stake held by the Reserve Bank of India.

State Bank of India is a banking behemoth and has 20% market share in deposits and
loans among Indian commercial banks.

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HISTORY

The roots of the State Bank of India lie in the first decade of 19th century, when the
Bank of Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806.
The Bank of Bengal was one of three Presidency banks, the other two being the Bank
of Bombay (incorporated on 15 April 1840) and the Bank of Madras (incorporated on
1 July 1843). All three Presidency banks were incorporated as joint stock companies
and were the result of the royal charters. These three banks received the exclusive
right to issue paper currency till 1861 when with the Paper Currency Act, the right
was taken over by the Government of India. The Presidency banks amalgamated on 27
January 1921, and the re-organized banking entity took as its name Imperial Bank of
India. The Imperial Bank of India remained a joint stock company but without
Government participation.
The All India Rural Credit Survey Committee proposed the takeover of the Imperial
Bank of India, and integrating with it, the former state-owned or state associate banks.
Subsequently, an Act was passed in the Parliament of India in May 1955. As a result,
the State Bank of India (SBI) was established on 1 July 1955. This resulted in making
the State Bank of India more powerful, because as much as a quarter of the resources
of the Indian banking system were controlled directly by the State. Later on, the State
Bank of India (Subsidiary Banks) Act was passed in 1959. State Bank of India (SBI)
is the largest bank in India. The bank traces its ancestry back through the Imperial
Bank of India to the founding in 1806 of the Bank of Calcutta, making it the oldest
commercial bank in the Indian Subcontinent. .

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The Government of India nationalized the Imperial Bank of India in 1955, with the
Reserve Bank of India taking a 60% stake, and renamed it the State Bank of India. In
2008, the Government took over the stake held by the Reserve Bank of India.
Pursuant to the provisions of the State Bank of India Act of 1955, the Reserve Bank of
India, which is India's central bank, acquired a controlling interest in the Imperial
Bank of India. On 1 July 1955, the Imperial Bank of India became the State Bank of
India. The government of India recently acquired the Reserve Bank of India's stake in
SBI so as to remove any conflict of interest because the RBI is the country's banking
regulatory authority.
In 1959, the government passed the State Bank of India (Subsidiary Banks) Act,
which made eight state banks associates of SBI. A process of consolidation began on
13 September 2008, when the State Bank of Saurashtra merged with SBI.
SBI has acquired local banks in rescues. The first was the Bank of Behar (est. 1911),
which SBI acquired in 1969, together with its 28 branches. The next year SBI
acquired National Bank of Lahore (est. 1942), which had 24 branches. Five years
later, in 1975, SBI acquired Krishnaram Baldeo Bank, which had been established in
1916 in Gwalior State, under the patronage of Maharaja Madho Rao Scindia. The
bank had been the Dukan Pichadi, a small moneylender, owned by the Maharaja. The
new banks first manager was Jall N. Broacha, a Parsi. In 1985, SBI acquired the Bank
of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its affiliate, the
State Bank of Travancore, already had an extensive network in Kerala.

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LISTINGS AND SHAREHOLDINGS



Non-banking subsidiaries
 SBI Capital Markets Ltd
 SBI Funds Management Pvt. Ltd
 SBI Factors & Commercial Services Pvt. Ltd
 SBI Cards & Payments Services Pvt. Ltd. (SBICPSL)
 SBI DFHI Ltd
 SBI Life Insurance Company Limited
 SBI General Insurance

Government of India,
61.23%
FIIs/GDRs/OCBs/NRIs,
11.17%
Banks & Insurance
Companies, 10.00%
Mutual Funds & UTI,
8.29%
Others, 9.31%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
Government of IndiaFIIs/GDRs/OCBs/NRIsBanks & Insurance
Companies
Mutual Funds & UTI Others

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VISION
 My SBI.
 My Customer first.
 My SBI: First in customer satisfaction

MISSION
 We will be prompt, polite and proactive with our customers.
 We will speak the language of young India.
 We will create products and services that help our customers achieve their
goals.
 We will go beyond the call of duty to make our customers feel valued.
 We will be of service even in the remotest part of our country.
 We will offer excellence in services to those abroad as much as we do to
those in India.
 We will imbibe state of the art technology to drive excellence.

VALUES
 We will always be honest, transparent and ethical.
 We will respect our customers and fellow associates.
 We will be knowledge driven.
 We will learn and we will share our learning.
 We will never take the easy way out.
 We will do everything we can to contribute to the community we work in.
 We will nurture pride in India.

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EMPLOYEES- SBI is one of the largest employers in the country with 209,567
employees as on 31 March 2017, out of which there were 23% female employees and
3,179 (1.5%) employees with disabilities. On the same date, SBI had 37,875
Scheduled Castes (18%), 17,069 Scheduled Tribes (8.1%) and 39,709 Other
Backward Classes (18.9%) employees. The percentage of Officers, Associates and
Sub-staff was 38.6%, 44.3% and 16.9% respectively on the same date. Around 13,000
employees have joined the Bank in FY 2016-17. Each employee contributed a net
profit of 511,000 (US$7,900) during FY 2016-17.

BOARD OF DIRECTORS
S.No Name Designation
1 Mr. Rajnish Kumar Chairman
2 Mr.B Sriram Managing Director
3 Mr.Dinesh Kumar Khara Managing Director
4 Mr.Rajnish Kumar Managing Director
5 Mr.P K Gupta Managing Director
6 Dr.Girish K Ahuja Nominee Director
7 Dr.Pushpendra Rai Nominee Director
8 Ms.Anjuly Chib Duggal Nominee Director
9 Mr.Chandan Sinha Nominee Director
10 Mr.Sanjiv Malhotra Director
11 Mr.Pravin Hari Kutumbe Director
12 Mr.Bhaskar Pramanik Director
13 Mr.Basant Seth Director

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LITERATURE REVIEW

Ponciano S. Intal, Jr. and Luis Osman Ranit, 2001, did research on
Agricultural Distribution Services Sector. A competitive agriculture sector requires
not only more productive farms and agricultural processors, but also a more
efficient agriculture distribution system. This is especially the case for the
Philippines being an archipelago of thousands of islands, of which only a few are
large enough to have the scale of farming that allow economies of scale in
processing. Thus, in comparison to Vietnam or Thailand or Peninsula Malaysia,
the Philippine agricultural economy is far more fragmented and vulnerable to the
inefficiencies and vagaries of the country's distribution system. There is a familiar
lament about the state of the Philippine agricultural distribution system; that is, it is
cheaper to bring corn from Bangkok to Manila than to bring corn from Cotabato to
Manila. This familiar lament exemplifies a fragmented agricultural economy.

A fragmented agricultural economy has important negative welfare effects on the
country. First, as the Congressional Commission on Agricultural Modernization
(Congress of the Philippines, 1997, p.72) noted,”marketing inefficiencies result in
farmers‟ getting low prices for their produce and consumers‟ paying more than the
fair price”. Second, unexpected large harvests leave farmers with much lower farm
prices in a fragmented economy than in a well-functioning distribution system.
Third, unexpected demand surges end up in increased imports rather than increased
sales by domestic farmers. Fourth, an inefficient distribution system leads to
additional pressure for agriculture protection in order for the domestic producers to
be able to compete with imports in greater Manila, the country's largest net deficit
food market. And finally, the resulting high food prices lead to demands for higher
wages.

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Ashutosh Shrivastava (1999), reported the main objectives of this study
were: (1) to study the socioeconomic status of the organized and unorganized
poultry farms in Jabalpur district of Madhya Pradesh state, India; (2) to find out the
cost of production of eggs and broilers on organized and unorganized farms; and
(3) to study the marketing channels for eggs and broilers. A sample of 15 poultry
units and 12 broiler farms was selected from the organized sector and 25 poultry
farms were randomly selected from the unorganized sector. The study covers the
period January 1997 to October 1998 for layer farms and April 1997 to March
1998 for broiler farms. Results reveal that commercial layer and broiler units,
particularly the larger farms, were well managed and cost effective as compared to
the small and medium farms. Among the four main marketing channels, two
account for a 75% share of egg marketing and one account for a 90% share of
broiler marketing. Poultry farming is considered to have good prospects in the
district due to relatively cheaper land and labour input originating from tribal areas.
It is recommended that efforts should be made to exploit this potential
.

Bhatt (1982), found in Jabalpur city of M.P. that capital investment on housing
and equipment was Rs. 39.3 and 1.7 per layer, respectively. Feed quantity per bird
per month in different stage was 1.02 kg. for chicks, 2.20 kg. for growers and 3.5
kg. for layers which cost about Rs. 1.64, Rs. 3.43 and Rs.5.27 respectively. Chick
cot till the age of birds for the period of 5 month on an average was Rs. 21.24. The
investment on raising poultry 17 month‟s which includes the 5 months of pre
production period was Rs. 106.4, Rs.102.09 and Rs. for the block size of 500 and
below, 501 to 1000 and above 1000 layers respectively. The total cost of raising
birds decreased with the increase in the farm size.
The average cost of production of eggs ranged from Rs. 0.32 to Rs. 0.34 per egg.
The average number of eggs production per bird per year was 259, 267 and 267 the
different size of poultry units.

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SCOPE OF FINANCING ALLIED
AGRICULTURAL PROJECTS IN M.P STATE

MEANING OF AGRICULTURE

Agriculture is the science, art, or occupation concerned with cultivating land, raising
crops, and feeding, breeding, and raising livestock; farming
ALLIED ACTIVITIES

Allied activities include those activities which are not related to traditional
activities like cultivation of traditional crops. It includes activities such as
horticulture, pisciculture, sericulture, apiculture, and dairy farming. These are the
high income generating practices which are not practiced by the farmers in the
country as a whole and Jammu region in particular.

The Reserve Bank Of India has put agriculture and allied activities under the
Priority sector in which it is mandatory for the banks to lend a specified portion to
the priority sector. In the priority sector finance to short term, long term and
medium term loans is given either directly or indirectly.

AGRICULTURE IN INDIA

Agriculture and its allied sectors is unquestionably the largest livelihood provider
in India, more so in the vast rural areas. It contributes significantly to the Gross
Domestic Product (GDP) of our country. Sustainable agriculture, in terms of food
security, rural employment, and environmentally sustainable technologies such as
soil conservation, sustainable natural resource management and biodiversity
protection is essential for holistic rural development. In the past, Indian agriculture
and allied activities witnessed a green revolution, a white revolution, a yellow
revolution and a blue revolution leading to livelihood enhancement of the farming
community in rural areas.

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The rapid growth and diversification of development activities resulted in much
needed expansion of employment opportunities; but, at the same time have
triggered rural to urban migration. This trend has inadvertently resulted in shifting
of farm labour to non-farm sectors.
India has the largest youth population in the world and is poised to increase further
in the coming decade. Nearly 70% of India‟s population is below the age of 35
years, making India the youngest nation in the world and interestingly 70% of
them live in rural areas.
According to 2011 Census, the youth population in the country including
adolescent youth is around 550 million. In 2020, the average Indian age will be
only 29-year-old, whereas in China, and the United States of America the average
age is estimated to be 37 years. We may utilize this demographic dividend for
taking Indian agriculture to a new height by channelizing the creative energies of
the youth through development of skills, knowledge and attitudes.

The declining share of traditional agricultural commodities in production,
consumption and trade, horticulture and other non-traditional high-value
agriculture represent an important area of potential income growth in rural areas.
The high-value agriculture-led-growth strategy also provides significant scope for
achieving greater commercialization of smallholder agriculture. Despite the
potential, the contribution of high-value agricultural exports is still small but
increasing.

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AGRICULTURE IN MADHYA PRADESH

Geography, Demography and Structural Composition
Madhya Pradesh (MP), located at the centre of India, is often called as the “Heart of
India”. It is a land locked state, surrounded by Uttar Pradesh, Chhattisgarh,
Maharashtra, Rajasthan and Gujarat. Until 2000, it was the largest state of the country
in terms of geographical area; however, in November 2000, Chhattisgarh was carved
out of the south-eastern part of erstwhile Madhya Pradesh. Currently, MP is the
second largest state in India after Rajasthan and it spreads over a geographical area of
about 308 lakh hectares, which is about 9 per cent of the total area of the country.

MP is the sixth most populous state in the country, with a population of 72.6 million
in 2011, which has been projected to increase to 79.0 million in 2016, accounting for
about 6.0 per cent of India‟s population. Around 71.3 per cent of the population lives
in rural areas as compared to the national average of 68.8 per cent, making MP a
largely rural economy. Unlike other states where the share of agriculture in GDP has
been falling, MP has undergone a reverse structural change after 2010-11. Between
2003-04 and 2010-11, the share of agriculture in GDP declined from 29.8 per cent to
22.5 per cent, reflecting the national trend. However, after 2010-11, the share of
agriculture in GDP has increased from 22.5 to 30.3 per cent in 2014-15. This trend
clearly shows the growing importance of the agriculture sector in the state. Moreover,
the sector provides employment to around 54.6 per cent of its workforce, much above
the all-India average of 47 per cent (Labour Bureau, 2015-16)
Trends in Agriculture Growth
In the recent past, MP has been lauded for its excellent performance of agriculture
MP‟s agricultural GDP grew at 9.7 per cent per annum during 2005-06 to 2014-15,
surpassing even record-holder Gujarat‟s 7.7 per cent. The last five years have been
even more spectacular: Agricultural GDP grew at 14.2 per cent per annum as
compared to the national average of 4.0 per cent.

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The agriculture growth rate since 2010-11 has been on an increasing trajectory and
reached a peak of 20.4 per cent in 2013-14, which was a good agricultural year for
the state with normal rainfall yielding better agriculture output. In 2014-15, the
agriculture growth moderated marginally due to a bad monsoon that resulted in a
drought. What is interesting is that agricultural growth in the two drought years 2008-
09 and 2009-10 was around 9 per cent in Madhya Pradesh while the all-India growth
rate plummeted to less than 1 per cent. Further, with very good monsoons in 2011-12
in all the four months of monsoon season, agricultural growth was around 13.4 per
cent.


Trend in Agriculture Growth in Madhya Pradesh


Source: Government of India, Central Statistical Organization. GSDP at Factor cost in 2004-05 prices

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Animal Husbandry – Dairy Development
Animal husbandry is the most important income generating activity under allied
agriculture. With a cattle and buffalo population of 196 lakhs and 81.9 lakhs as per
the livestock census, 2012, the State accounts for 10% of cattle and 7% of buffalo
population of the country. Crossbred cattle constituted 4.3% of total cattle in the
State, as against 21% in the country. This share has increased from 2.2% and 17%
respectively as per the 2012 census. The annual growth rate in crossbred cattle
population in the State during the period 2007-12 was 15% as against 4% observed
for the country. However, there was a decrease of 12% in the indigenous cattle and
a decrease of10% in buffalo population during the same period. Efforts of the State
Government in increasing milk production are yielding desirable results. Milk
production in the State went up from 88.38 lakh tons during 2012-13 to 95.99 lakh
tons during 2013-14. It grew at an average of 8.5% per annum during 2011-12 to
2012-13 and thereafter at 8.61% per annum during 2013-14. Buffalo is the major
contributor with 50% of total milk production coming from them, followed by
indigenous cows at 38%, cross bred cows and goats at 6% each. Per capital
availability of milk has also increased from 308 gm. in 2011-12 to 345 gm. in 2014

Milk Production in MP


Source: National Dairy Development Board (NDDB)

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DAIRY DEVELOPMENT FINANCIAL PROJECTION




Sheep, Goat, Piggery
Goat population has declined from 90.1 lakh during 2007 census to 80.1 lakh
during 2012. Only 4% of these belong to Jamnapari and Barbari breeds and the
remaining are non-descript type. Since goats also contribute significantly towards
milk production in the State, rearing of Jamnapari, which is a dairy breed may be
encouraged. Sheep rearing is not popular in the State. Their population has
decreased by 21% during the period 2007-12.



46743.21 48952.63
172414.95
7470.9
54317.43
57360.23
4564.25
1030.13
12796.2
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
200000
Financial Share
Financial Share

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Sheep, Goat, Piggery - Physical and Financial Projection

ACTIVITY PHYSICAL(No.) FINANCIAL(in
lakhs)
Goat rearing 39722 37462.71
Sheep Rearing 8269 5354
Piggery 2861 8399.91
Miscellaneous 559 4661.42
Total 51411 55878.04






37462.71
5354
8399.91
4661.42
0
5000
10000
15000
20000
25000
30000
35000
40000
goat rearing sheep rearing piggery miscellaneous
FINANCIAL SHARE
FINANCIAL SHARE

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Poultry Development

Meat accounts for only 5 per cent of the total value of output from the livestock
segment. Its share in GVOA has marginally increased from 0.6 per cent in TE 2002-
03 to 0.9 per cent in TE 2013-14. Between 2006-07 and 2014-15, meat production
increased from 20 thousand tonnes to 60 thousand tones, an increase of 200 per cent!
Of the total meat produced in the state, around 76 per cent is poultry meat, 36 per cent
is buffalo meat and 28 per cent is goat meat. The poultry segment in MP got a
stimulus with the establishment of the Madhya Pradesh Women Poultry Producer
Company Pvt. Ltd. (MPWPCL). It has ten producer organizations operating under it,
each holding a stake in the producer company. Each of these producer organizations is
an independent entity involved in providing services such as raw materials, working
capital assistance, risk mitigation from input and output price movements, production
support as well as marketing broiler poultry to its members and providing training and
building capacity among women. The co-operative membership extends to 4,214
women poultry producers belonging to poor tribal and Dalit families. Currently,
MPWPCL is one of the biggest producers of broiler chicken in the state. This was
achieved by first establishing four feed processing units, which supplied feed to the
co-operatives, and then taking on the contract for manufacturing medicines. Marketing
is done under the brand name „Sukhtawa Chicken‟. In 2011, a parent farm and
hatchery was commissioned. The end-to-end integration and scale of operations under
MPWPCL has given the producers bargaining power to influence market decisions
and protect farmers from market volatility and depletion in their profit margin (Garg
and Kumar, 2011).
Egg production in MP has also increased significantly from 951.8 million in 2006-07
to 1,177.6 million in 2014-15. Such a phenomenal rise in the production of meat and
eggs requires enlargement of storage capacity so as to minimize wastage and damage.
Although, at present, there are around 122 cold storages in the state with a total
capacity of approximately 712.3 million MT (2012-13), there is a pressing need to
develop storage and marketing infrastructure to further bolster the segment.

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Meat Production in MP
Source: GoMP,

POULTRY DEVELOPMENT- FINANCIAL PROJECTION

9165.93
9405.61
6466.37
0
2000
4000
6000
8000
10000
commercial broiler commercial layer miscellaneous
Financial share
Financial share

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FISHERIES

Since Madhya Pradesh is land locked, inland fishery is favored in the state. Although
only 0.2 per cent of the state GDP is contributed by fishery, this sector has huge
potential. MP has around 4.03 lakh hectares of reservoirs and tanks, which can be
utilized for fishing.

Fish production has increased from 47.5 thousand tonnes in 2001-02 to 109.1
thousand tonnes in 2014-15, (Figure 20) a CAGR of 5.7 per cent. MP contributes only
about 1.6 per cent of the total inland fish production, while major inland fish
producing states in India such as Andhra Pradesh and West Bengal contribute around
26 per cent and 23 per cent respectively (GoMP, 2016).
The country is the second largest fish producer in the world, ranking only to
China and contributes to 5.68% share in the global fish production. Besides offering a
rich source of cheap and nutritious diet, the sector is also source of livelihood for a
large section of the economically backward population of the country. The total
production of 9.626 mill MT(2013-14) is from inland fishery. As per the advance
estimates released by CSO for 2014-15, this sector contributes to 0.19% of total
GSDP and 0.63% of GDP from agriculture.


Being landlocked with no coastline, the development of the sector in the State is
entirely dependent on the inland water resources. The State, however, is blessed with
abundant water resources in the form of rivers, ponds, lakes and dams.

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Fish production in MP

Source: GoMP, 2016

Fisheries Development Projection

major carps, 73
minor carps, 8
exotic
carps,
13
murrels
, 1 catfish, 4
others, 1
Other, 5
Financial Share

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APICULTURE
Beekeeping is practiced over a greater area of earth‟s surface then perhaps any other
single branch of agriculture band on it depends the success of many other branches of
agriculture.
Honeybee originally belongs to old world-Europe. Africa and Asia and the bees
spread to the new world after 1638 in America, 1822 in Australia and 1842 to New
Zealand. The real boost to scientific beekeeping took place with the discovery of
moveable frame hive by Langstron 1851. Later, sequence of events took place by
studying the biology of honeybees, development of beekeeping methods,
identification of different casts, queen mating, role of bees in pollination etc. Although
the beekeeping has since undergone tremendous change both in equipment and
management but the basic principles have remained the same, as advocated by
Langstroth and Dadant and still form the basis of modern beekeeping. During the next
half century i.e. between 1850 to 1900, beekeeping explored in the new world. Today
most of the countries practice beekeeping with the European honeybee Apis mellifera
which surpasses the Asian boney bee Apis Cerana.
In India Apis Mellifera was first introduced in J&K because temperate zone is better
suited for honey bees for commercial honey production. In India average honey
production with Apis mellifera is 40 to 70 kg/year/colony. India produces 18000MT
of honey annually.

SERICULTURE
India is the second largest producer of silk in the world, after China. It has the unique
distinction of producing all four varieties of silk: mulberry, eri, tasar and muga.
Mulberry accounts for 92.5 per cent, Eri 5.3 per cent, Tasar 1.7 per cent and Muga 0.5
per cent of the total raw silk production in the country. The rearing of silk worms on
mulberry trees for the production of raw silk is known as sericulture. Mulberry silk is
produced mainly in Karnataka, West Bengal, Jammu and Kashmir,Assam, the Punjab,
Tamil Nadu and Andhra Pradesh
The sericluture development department is laying stress in raising dwarf mulberry
trees to supplement and replenish the tall mulberry trees. As a result, the dwarf varities
have increased substantially in the state. New hybrid species of silkworm need to be

25. P a g e | 24



developed which can withstand the adverse climatic conditions. Such species of
worms enhance the quality of raw silk.


Agriculture Credit
To create an efficient agricultural production base, farmers at the bottom of the
agriculture value chain require well-timed working and investment capital. For
example, farmers require timely working capital during the production season to buy
inputs and hire labour and investment capital for farm equipment, buildings, storage
facilities and transport. The inability to access finance at the right time can adversely
affect the quantity and quality of output, ability to diversify production to stay
competitive and to increase the farmer‟s share in the final value of the product
(UNCTAD, 2004). However, banks are usually reluctant to finance agriculture due to

26. P a g e | 25



commercial and systemic risks (or covariant risks, due to natural calamities, pests and
diseases) associated with it, which could result in large scale losses. From a bank‟s
perspective, demand-side constraints (e.g., repayment capacity, poor credit track
record) and supply-side constraints (e.g., lack of information on the borrower, high
transaction costs) further widen the agricultural financing gap (Subbarao, 2012). In
order to address this financing gap and to meet the financing needs of farmers.

MP state government initiated a zero per cent interest rate scheme for the short term
loans in 2012-13 through state owned co-operative banks. As on 2014-15, MP had
one state co-operative bank (MPSCB), 38 district central cooperative Bank (DCCB),
one state co-operative agriculture and rural development bank (MPSCARDB), and 38
district co-operative agriculture and rural development banks (DCARDBs). Further,
it has 37 commercial banks and three regional rural banks (RRB). These banks have
around 5,949 branches in the state (2012-13). Moreover, 4,530 primary agriculture
credit societies (PACS) are also operational in the state. As per the norm, while a
farmer gets a crop loan at 0 per cent interest rate, the co-operative bank actually
charge 11 percent interest, but 6 per cent of this is subsidized by the state government
and remaining 5 per cent by the National Bank for Agriculture and Rural
Development (NABARD). Before 2006-07, the interest rate chargeable to farmers
was 16 to 17 per cent; it was reduced to 7 per cent in 2006-07, 5 per cent in 2008-09,
3 per cent in 2011-12 and finally to 0 per cent in 2012-13 (Figure 32). Consequently,
disbursement of crop loans increased from Rs.33.3 billion in 2006-017 to Rs.112.1
billion in 2013-14. In 2012-13, interest subsidy of Rs.3.3 billion was made available
to co-operative institutions by the state government for around 30 million farmers.
Further, a provision of Rs 5 billion was made in the departmental budget for interest
subsidy in the year 2013-14.


Additionally, the centrally sponsored kisan credit card (KCC) scheme provides
agricultural; credit to farmers at an interest rate of 7 per cent through commercial
banks, co-operative banks and RRBs. Under this scheme, all farmers including small
and marginal farmers, share croppers, oral lessees and tenant farmers are eligible for
KCCs. Banks assess a farmer‟s eligibility on the basis of the cultivable land in their
own names. This is a severe limitations for landless agriculture labourers, who often
farm on leased land.
,

27. P a g e | 26



RESEARCH METHODOLOGY


Research methodology is a way to systematically solve the research problem. It is a
science of studying how research is done scientifically. In it we study the various steps
that are generally adopted by a researcher in studying the research problem along with
the logic behind them.
STATEMENT OF PROBLEM: - For the successful completion of any research
work or project, a clear understanding of the problem at hand should be
accomplished. The problem refers to nothing but the issue taken by the
researcher to undertake and ultimately complete his or her research. In this
project problem deals with the “scope of financing allied agriculture projects in
MP state”. In this we shall study that what percentage of people are engaged in
allied agriculture activities and how far it can be promoted through financing
their activities.
OBJECTIVES OF THE PROJECT :
 To know the satisfaction level of the farmers.
 To know the grievances of the farmers at the time of availing agriculture loan.
 To know the perception of the farmers towards the agriculture loan.
 To know the perspective of farmers for adopting allied agriculture activities.
SAMPLE SIZE: - The sample size is 50 respondents.
SAMPLING TECHNIQUES : - Technique of Convenience sampling.
SAMPLE AREA :- Distributed areas of Bhopal,Sehore Raisen,Vidisha Distt.
SAMPLE UNIT :- Farmers

28. P a g e | 27



RESEARCH DESIGN: - The research design employed in the study is Exploratory
Research.
INFORMATION ACQUIRING TECHNIQUES :-Information has been collected
using both primary and secondary method.
Primary method: Scope of allied agriculture activities is found out through
Questionnaire method. A questionnaire for analyzing the scope of allied agriculture
has been prepared in consideration with Mr.Manoj Rastogi. This questionnaire was
then distributed to the farmers.
Secondary method: Sources of information have been collected through catalogs,
website and reports files and records, research papers information provided by
NABARD, Dept. of animal husbandry, Fisheries Dept., MPCDF.
QUESTIONNAIRE DESIGN :-The questionnaire has been designed covering 14 queries
made to 50 farmers which represent sampling at random.
DATA COLLECTION: - The data is collected by using survey method.
DURATION OF THE STUDY :- The duration was for 10 weeks.
LIMITATIONS OF THE STUDY

 Time constraint

 Some people have not given accurate information.

 It was not possible to survey each and every village in the region,

 In order to gather information a lot of time was wasted in travelling. Due to
severe farmer‟s agitation was ongoing, time has been wasted.

 Data regarding allied agriculture is not readily available on sites of Madhya
Pradesh government.

29. P a g e | 28



ANALYSIS AND INTERPRETATION OF THE DATA

Q1. What are your main Enterprises?
S.No. Particulars Frequency
1 Dairy 10
2 Cultivation of crops 30
3 Sericulture -
4 Apiculture -
5 Poultry 10



Interpretation:
From this it is certain that most of the people in sub urban and rural areas are engaged
in traditional agriculture practices. Only dairy and poultry are the allied activities
which are taken up by the people, in that too , mainly who are having high net worth
or background following familiar practices.
10
30
10
0
5
10
15
20
25
30
35
Dairy Cultivation of Crops Poultry
Numbers

30. P a g e | 29



Q2. Would you like to pursue allied agriculture activities in future?

S.No. Particulars Frequency
1 Yes 15
2 No 35





Interpretation
Most of the people are not ready to get into allied agriculture sector as it has a lot of
complexity and now people engaged in farming are old people and unable to do so
much of labour, they are frightened that allied agriculture sector involves huge cost of
setup and due to lack of technical know how they resist in exploring this field.




0
5
10
15
20
25
30
35
40
Yes No
Numbers
Numbers

31. P a g e | 30



Q3. How do you see the demand of allied agriculture activities in the future?

S.No. Particulars Frequency
1 Increase
significantly
35
2 Increase a little 10
3 Stay the same -
4 Decrease -
5 Don‟t know 5




Interpretation:

Majority of the people in the villages are aware of the growing demand of fruits, meat,
honey, milk, etc. They understand the growing needs of people with the changing
lifestyle of urban as well as rural people.


70%
20%
0 0
10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Demand Forecast
Demand Forecast

32. P a g e | 31



Q4. From where would you like to take advances for agriculture needs?

S.No. Particulars Frequency
1 Moneylenders -
2 Banks 10
3 Family & Friends 40




Interpretation:

Most of the farmers do not work on large scales so not much financial assistance is
required. If its required then they borrow from rural banks. Also due to interest rate
fluctuations and mortgage related problems, they avoid taking loan from private and
public banks.



20%
80%
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Moneylenders Banks Family & Friends
Advances
Advances

33. P a g e | 32



Q5. Have you ever taken agriculture loan?


S.No. Particulars Frequency
1 Yes 10
2 No 35
3 Yes but not
received
5



Interpretation
The farmers are afraid of borrowing money from the banks because of its high rate of
interest. Moreover a lot of paper work is required which is not easily understood by
the farmers.







20%
70%
10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Yes No Yes but not
received
Agriculture Loan

34. P a g e | 33



Q6. If no, state the reasons for not availing the loans?

Interpretation:

 High rate of interest is charged by the banks and the farmers are unable to give
monthly installments.
 People are afraid of taking loans from banks even if they are able to generate
sufficient income because they hear news of farmers hanging till death because of
high debt.
 Farmers along with agriculture are engaged in other income generating activities as
well and they use that income in their farms.
According to the farmers taking loan from banks is not an easy task.

35. P a g e | 34



Q7. If yes, from which bank you have taken loan?

S.No. Particulars Frequency
1 SBI 3
2 HDFC Bank 2
3 Punjab national
Bank
-
4 Agri.societies,rural
banks
7



Interpretation:
People in the sample area prefer to take loans from rural banks because the loans are
sanctioned with less formality, lower rate of interests and are in the reach of the
masses.


3
2
0
7
0
1
2
3
4
5
6
7
8
SBI HDFC Bank PNB Rural Banks
BANK
BANK

36. P a g e | 35



Q8. For taking agriculture loan, what are your financial requirements?

S.No. Particulars
1 Less than 50,000
2 Upto 100,000
3 Above 100,000 but less than
300,000
4 Above 300,000



Interpretation:
Not much people in these areas are happy to take loans but those who do are mostly
doing business of less than Rs 100000 because the land is fragmented. Only some
doing business on large scale require finance for machinery as well as seeds and
pesticides, etc.

0
1
2
3
4
5
6
less tha 50000upto 100000Above 100000 but
less than 300000
Above 300000
Loan Amount
Loan Amount

37. P a g e | 36



Q9. Put a tick mark if you aware of any of the following government
sponsored schemes launched in the state?
S.No. Particulars Frequency
1 Kisan Credit Card 45
2 Agriculture Gold Loan 5
3 Kisan Call Centre 50
4 Rastriya Krishi Vikas
Yojna
-
5 Bhandar Grih Nirman
Yojna
-



Interpretation:
Kisan Credit Card and call centre is the famous scheme of the government among the
farmers. Majority of the farmers are having kisan credit card and can avail the
benefits of it any time if the need arises.

Kisan credit
card
Agriculture
Gold Loan
Kisan call
centre
Rastriya krishi
vikas yojna
Bhandar ghih
nirman yojna
Schemes 45 5 50 0 0
0
10
20
30
40
50
60
Frequency

Schemes

38. P a g e | 37



Q10. How you came to know about the above scheme?

S.No. Particulars Frequency
1 Relatives 10
2 Friends 30
3 Publicity by banks 10
4 Social Media -
5 Any other -



Interpretation:

People involved in agriculture sector discusses every new thing they find out in the
market amongst themselves. Due to which it becomes a medium to generate
awareness among people in the villages. Moreover camps conducted by banks are
quite fruitful to clear all the doubts regarding banking in which people actively
participate.

20%
60%
20%
0 0
0%
10%
20%
30%
40%
50%
60%
70%
RelativesFriendsPublicity by
Banks
Social MediaAny other
Sales

39. P a g e | 38



Q11. Your satisfaction level after getting the agriculture loan?

S.No. Particulars Frequency
1 Highly satisfied -
2 Satisfied 10
3 Neutral 5
4 Dissatisfied -
5 Highly Dissatisfied -




Interpretation:

Farmers generally do not prefer to take loans, so the point of satisfaction does not
arise. Those who have taken the loans, some are satisfied and some are neutral.


0
67%
33%
0 0
0
0.05
0.1
0.15
0.2
0.25
Column1

40. P a g e | 39



Scale to measure the perception of farmers towards agriculture

S.No. Statements SA A N DA SDA

1 Allied agriculture is a profitable venture 10 15 20 5
2 Agriculture sector has more influence on the overall
development of community
8 17 22 3
3 Allied agricultural activities should be run parallel to
that of the core farming
25 20 5
4 There is enough opportunity for career development
in agriculture
10 15 20 10
5 Greater economic prosperity could be achieved in
allied agriculture
10 20 10 10

6 Natural calamities affect your yield 10 20 15 5
Here, SA – strongly agree, A- Agree, N- Neutral, DA- Disagree, SDA- Strongly
disagree

Interpretation:

This table shows that majority of the people find allied agriculture as a profitable
business, great economic prosperity can be achieved and agriculture ensures food
security as well. Although some people disagree on the fact that there is enough
opportunity in the agriculture sector because the farmers are unable to get profits as
risks are higher than returns. Moreover the young generation does not want to
indulge in traditional farming but they are finding new varieties of organic farming
techniques with the help of technological advancement which provides high yield
and are easy to sustain.

41. P a g e | 40



RECOMMENDATIONS AND SUGGESTIONS


1) Public investments in key infrastructure such as improved power supply and
better road connectivity to incentivize and attract private investment at the farm
level in the form of increased investment in tube wells the expansion of area under
horticulture, especially the adoption of high value crops such as seasonal
vegetables, and the setting up of dairy units

2) MP was among the first of the major states to remove horticultural produce from
the monopoly of the Agriculture Produce Marketing Committee (APMC)
controlled mandis in 2012. It needs to follow up this decision with policy
incentives to attract private market yards offering electronic and sample based
trading. This will bring bulk buyers, processors, exporters etc., to the state to
source fresh produce and provide greater marketing choice to farmers. At present,
MP is a net exporting state for fruits and vegetables, given its low urban
population. Its favorable location, enabling quick access to both major northern
and western urban markets, could be leveraged successfully with appropriate
policy incentives.

3) A related issue in the agricultural marketing policy is the roll-out of the
Government of India‟s e-NAM electronic marketing portal, where MP has been a
relatively low key participant so far. Given the wide range of crops offered by the
state and its location in the center of the country, accelerated expansion of the e-
NAM platform could benefit the farmers in due course in terms of increased selling
choices. MP pioneered the e-chaupal initiative over a decade and a half ago with a
private sector partner (ITC) and saw improved price realization for soybean
farmers. e-NAM is a public initiative and could bring benefits to a much larger
number of farmers across a larger area, if patronized by the state and implemented
after due assaying, grading of produce, and setting up an effective dispute settle
mechanism between buyers and sellers .

42. P a g e | 41



4) Although milk production has increased from 4.8 million tonnes in 2000-01 to
10.8 million tonnes in 2014-15, milk productivity in the state is lower than in some
of the other states. For example while MP‟s productivity in milk production stood
at 0.8 MT per female animal per year, productivity in Punjab was 2.4 MT per
female animal per year, Gujarat 1.1 MT, and UP 1.0 MT per female animal per
annum. One of the factors for this low milk productivity could be the lower
proportion of genetically superior cattle (crossbred). In Punjab, exotic/crossbred
female cattle population as a proportion of the total female cattle population was
around 91.5 per cent, while in MP, it was only 6.0 percent in 2012. The state needs
to significantly scale up the population of crossbred/exotic female cattle population
to improve milk productivity

5) Among the most effective measures would be a state level credit guarantee fund,
which would provide comfort to all institutional lenders licensed by RBI for loans
advanced to Farmer producer organizations up to a limit.

6) Expand Financing storage facilities both at the farm level as well as organized
cold storages based on solar power, will significantly enhance the capacity of the
state‟s farmers to benefit from price differentials during lean supply months.

7) SBI could establish a virtual platform, as a part of corporate social
responsibility, on the foot lines of ITC‟S e-choupal, where farmers can procure and
sell the products digitally.

8) A Possible Tie-up with MP state Dairy cooperative Federation to provide
financing facilities to the small „samities‟ from which „Dungdh Sangh‟ procure
milk on daily basis.

43. P a g e | 42



CONCLUSION

From my research, I would like to conclude that SBI has still long way to go ahead
in terms of agriculture loans in MP state especially. Here people prefer taking
loans from rural banks apart from any other bank.


Branches need to focus more on customer awareness and conduct timely
campaigns in the villages and inform them about the new and existing schemes of
agriculture loans. The processing of agriculture loan is simple and easy for both the
staff as well as customers. As scope of agriculture loan is vast in the area, bank has
a high opportunity to increase its shares in this segment.

This will increase the standard of the bank and useful to the farmers in times of
need which is profitable for the bank. Branches should focus more to market there
product and recommendations of this study are implemented, growth of agriculture
loan may improve.


The farmers are engaged in traditional farming and they are not ready to shift to
allied agriculture because a mindset has been created that traditional farming reaps
more benefit. Albeit, it is not true as a lot more profits can be made through allied
agriculture activities. A step forward must be taken up both by the banks through
subsidies as well as by farmers to indulge into allied agriculture sector.

44. P a g e | 43



ANNEXURE:

General Purpose Survey

NAME Of THE RESPONDENT-
CONTACT NO.-
ADDRESS-
SIGNATURE-

THIS QUESTIONNAIRE IS A PART OF SUMMER INTERNSHIP PROJECT BEING
CONDUCTED BY Mr.ABHISHEK SHRIVASTAVA, STUDENT OF Dept. of
Mgmt.studies,MANIT BHOPAL. KINDLY TICK(√) ON THE RELEVANT OPTION/S. THE
INFORMATION FURNISHED HERE WILL TRULY REMAIN CONFIDENTIAL.

Q1) What are your main Enterprises?
o Dairy
o Cultivation of crops
o Sericulture
o Apiculture
o Poultry

Q2) Would you like to pursue allied agriculture activities in future?
o Yes
o No
o If no, why

Q3) How do you see the demand of allied agriculture activities in the future?
o Increase significantly
o Increase a little

45. P a g e | 44



o Stay the same
o Decrease
o Don‟t Know
o
Q4) From where would you like to take advances for agriculture needs?
o Moneylenders
o Banks
o Family & Friends

Q5) Have you ever taken agriculture loan:
o Yes
o No
o Yes but not received
o
Q6) If no, state the reasons for not availing the loans:


Q7) If yes, from which bank you have taken loan:
o SBI
o PNB
o HDFC Bank
o Other cooperative societies/Rural Banks

Q8) For taking agriculture loan, what are your financial requirements:
o Less than 50,000
o Upto 100,000
o Above 100,000 but less than 300,000
o Above 300,000

46. P a g e | 45



Q9) Put a tick mark if you aware of any of the following government sponsored
schemes launched in the state:
o Kissan Credit Card
o Agriculture Gold Loan
o Kissan Call Center
o Rashtriya Krishi Vikas Yojna
o Bhandar Grih Nirman Yojna

Q10) How you came to know about the above schemes:
o Relatives
o Friends
o Publicity by banks
o Social media
o Any other, please specify

Q11) Your satisfaction level after getting the agriculture loan
o Highly satisfied
o Satisfied
o Neutral
o Dissatisfied
o Highly Dissatisfied

47. P a g e | 46



Scale to measure the perception of farmers towards agriculture

S.No. Statements SA A N DA SDA

1 Allied agriculture is a profitable venture
2 Agriculture sector has more influence on the overall
development of community

3 Allied agricultural activities should be run parallel to
that of the core farming

4 There is enough opportunity for career development
in agriculture

5 Greater economic prosperity could be achieved in
allied agriculture


6 Natural calamities affect your yield
Here, SA – strongly agree, A- Agree, N- Neutral, DA- Disagree, SDA- Strongly
disagree



Any Suggestions

48. P a g e | 47



REFERENCES


 P. (Ed.). (2014, December). Indian agricultural plans and initiatives.
Retrieved June 25, 2017,from•http://www.krishijagran.com/farm/scenario-
in-india/2014/12/Indian-Agriculture-Plan-and-Initiatives-for-the-Year-2014-
15
 P. (2001, January/February). Agricultural distribution service centre.
Retrieved June 25, 2017, from • http://farmer.gov.in/shortloan.html
 Sbitraxcn.nd.Inwikepediaretrievedjune,2017fromhttps://en.wikipedia.org/
wiki/State_Bank_of_India
 P. (2001, January/February). Agricultural distribution service centre.
Retrieved June 25, 2017, from • http://farmer.gov.in/shortloan.html

 Written material and Reports from NABARD office, Dept. of animal
Husbandry, Fisheries Dept. , Kisan Vikas Kendra, Bhopal Dugdh
Sangh,APEDA, Veterinary Dept.