LAHORE, June 13: The Agriculture Development Bank of Pakistan will raise its loan ceiling next year, its chairman, Istaqbal Mehdi, told reporters on Thursday.

Mr Mehdi was here to attend a meeting of the Farmers’ Associates Pakistan. The Bank, he claimed, was subsidizing the loans to farmers by three per cent, charging a 14 per cent mark-up for the service which cost it around 17 per cent. He said the Bank paid around six per cent of the principal to the State Bank of Pakistan, the administrative costs came to around 3.5 per cent and unrecovered loans about 7.5 per cent.

The Bank administration, he said, was trying to cut down the administrative costs. This, however, would take time. Another way to cut down the cost, he said, was to improve loan recovery. The Bank, he said, was doing its best in this regard. Farmers must now join the drive.

About calamity-hit areas, he said, the declaration was a prerogative of the provincial government concerned.

He said complaint cells had been established in all eight zones to improve the Bank’s working and the management was scrupulously monitoring them.

The Bank, he claimed had also decided to expand into non-traditional lending and identified around 130 agriculture sub-sectors for the purpose. He said more than Rs4 billion had been allocated for the purpose.