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ISLAMABAD: Amendments to the ‘Loans for Agricultural, Commercial and Industrial Purposes Act of 1973’ were proposed by the inter-ministerial committee (IMC) on Tuesday.

The committee meeting was chaired by Privati­sation Minister Daniyal Aziz.

The amendments to the said act were initiated by the Ministry of Finance in a cabinet meeting held on Jan 29.

Mr Aziz emphasised the need to revamp the entire policy regarding loans. This will help in opening the doors to allied sectors for sustainable growth of national economy, he said.

He suggested that the requirement for provision of produce index unit (PIU) for agricultural loans should be removed in order to simplify the procedure. At the same time, an agricultural advisory committee must be formulated in order to streamline the matters relating to agricultural loans, the committee proposed.

The minister directed the heads of financial institutions to pay attention to provide financial services to other sectors of national economy for rapid and balanced economic growth in the country.

He called upon the financial institutions to enhance their outreach in rural areas of the country.

He also stressed the need for channelising remittances and utilising them for productive measures.

The minister said that all banks and microfinance institutions would be taken on board to prepare a comprehensive report which would be submitted in cabinet meeting for approval. The meeting was held to deliberate on the future course of action regarding proposed amendments in the act.

The IMC was formulated by the cabinet after the submission of summary by Finance Division related to the announcement made by the then finance minister Ishaq Dar which proposed enhancing the rate of PIU from Rs4,000 to Rs 5,000.

The initiative was meant to facilitate farmers in terms of credit incurred from banks. The proposal could be materialised only after an amendment in Section (5) 1 of the Loans for Agriculture Purposes Rules, 1973.

Published in Dawn, February 14th, 2018