Jharkhand Banks Exceed Lending Goals, Yet Agriculture Credit Lags

Despite Jharkhand banks surpassing national targets for priority sector lending, agricultural credit remains significantly below mandated levels, according to a report from the State Level Bankers’ Committee (SLBC). As of September 30, 2025, banks in the region directed only 14.87 percent of total bank loans to agriculture, falling short of the Reserve Bank of India’s (RBI) target of 18 percent.

As reported, banks’ priority sector advances reached 50.11 percent of their total advances amounting to Rs 158,714 crore, a figure that notably exceeds the national benchmark of 40 percent. However, the allocation towards agricultural lending reveals a troubling shortfall, pointing to a critical gap in support for the rural economy.

Growth in Agricultural Lending, Yet Challenges Persist

Between March and September 2025, agricultural lending in Jharkhand saw an increase from Rs 23,032 crore to Rs 23,594 crore, reflecting a growth rate of 13.98 percent. Despite this positive trend, ten public sector banks, including Indian Bank, Central Bank of India, Punjab National Bank (PNB), and United Commercial Bank (UCO), reported lending rates below the required 18 percent.

Additionally, fourteen private banks, such as Axis Bank, Kotak Mahindra Bank, Bandhan Bank, and the Industrial Development Bank of India (IDBI), exhibited similar deficiencies in their agricultural lending practices.

Urgent Call for Policy Reforms

Officials from the SLBC have highlighted the importance of addressing this shortfall, emphasizing that while banks are meeting broader priority lending targets, they are not adequately supporting agricultural development. This concern has been repeatedly voiced in SLBC meetings and agriculture sub-committee discussions.

The committee has called for “immediate solid steps” to bridge the credit gap, recognizing that enhanced support for agriculture is essential for sustaining the rural economy in Jharkhand. Without prompt action, the potential for agricultural growth and rural prosperity could remain compromised.

The SLBC’s findings underscore a vital policy challenge, revealing a disconnect between priority sector lending achievements and the critical need for increased agricultural financing. Stakeholders are urged to reconsider lending strategies to ensure more equitable support for the agricultural sector in the state.