Primary Cooperative Agriculture and Rural Development Bank: Sericulture in Irrigated Area (Tamil Nadu)

What is the PCARD bank sericulture loan for irrigated area?

Sericulture in Irrigated Area is a term loan offered by the Primary Cooperative Agriculture and Rural Development Banks (PCARD banks) of Tamil Nadu to farmers who want to take up mulberry cultivation and silkworm rearing on land with an assured water supply. The banks function under the Cooperation, Food and Consumer Protection Department and are supervised by the Registrar of Cooperative Societies.

The Tamil Nadu government scheme directory records the loan at Rs 49,000 to Rs 79,000 per acre, at interest reported between 11 and 12.75 per cent.

Sericulture is an unusual farm enterprise, and understanding why explains the loan amount. A sericulture unit is not one activity but two joined together. On the land, the farmer grows mulberry, a perennial crop that is cut and harvested repeatedly for leaf. Alongside it, in a purpose-built rearing house, the farmer raises silkworms that eat that leaf and spin cocoons, which are then sold at a cocoon market. The cycle from young worm to cocoon runs a few weeks, so a working unit produces several crops of cocoons a year and generates income far more frequently than an orchard does.

That structure has two consequences for finance. The establishment cost is high. A rearing house with proper ventilation, rearing stands and trays, mountages for spinning and disinfection equipment is a substantial building and equipment investment on top of the mulberry planting, which is why a per-acre figure of Rs 49,000 to Rs 79,000 is far above what an ordinary crop attracts. And the repayment can begin relatively early, because cocoon income starts within months of the mulberry establishing, unlike a fruit orchard's multi-year wait.

The irrigated area qualification is the heart of the scheme name. Silkworms must be fed continuously and on good-quality leaf; a break in leaf supply loses the crop. The cooperative framework therefore separates irrigated sericulture, with its higher unit cost and higher expected yield, from rainfed sericulture, which carries a lower unit cost.

One caveat belongs up front. Cooperative department material records that, owing to the non-availability of refinance from the National Bank for Agriculture and Rural Development, PCARD banks are at present issuing only jewel loans out of available funds. The sericulture line exists in the scheme framework; whether your bank can disburse it this year is a question to ask before spending on an encumbrance certificate and a project estimate.

Who is eligible for the sericulture loan?

You can borrow if:

• You own agricultural land in your own name, shown by patta and chitta or adangal, within the taluk served by the PCARD bank.
• The land is irrigated, a well, borewell with a working pumpset, canal ayacut or other assured source. This is a defining condition of this particular scheme, not a general preference.
• The land is free of prior charge, shown by an encumbrance certificate.
• You propose to plant mulberry and rear silkworms, with a plan for the rearing house and the appliances.
• You are, or become, a member of the bank by subscribing to shares.
• You are not a defaulter to any cooperative institution.

You cannot borrow if:

• You are a tenant farmer, sharecropper or agricultural labourer without land in your own name. Land security is the basis of a PCARD bank loan.
• Your land is rainfed with no assured water source, in which case this particular unit cost does not apply and a different, smaller rainfed unit is the relevant one.
• The land is already mortgaged or carries an encumbrance.
• You are outside the bank's operational area.
• You are an existing defaulter at the village primary agricultural cooperative credit society, the District Central Cooperative Bank or another PCARD bank.
• The bank has no refinance funds, in which case a sound application still will not be sanctioned.

How much is sanctioned, and what does it cover?

Within a per-acre unit cost, the main heads a sericulture estimate normally carries are:

• Mulberry establishment, land preparation, planting material or saplings, manure, and the first year's cultivation cost.
• Irrigation arrangements; channels, drip or sprinkler lines from an existing source to the mulberry plot.
• Rearing house — the largest item. A shed with adequate floor area, cross-ventilation and a hygienic floor, sized for the number of disease-free layings the farmer plans to brush per crop.
• Rearing appliances: stands, trays or shoot-rearing racks, mountages for spinning, leaf chopping boards, sprayers.
• Disinfection and hygiene, the recurring cost that most determines whether a crop succeeds, and the one new entrants most often underestimate.

Because the rearing house dominates the estimate, the figure at the upper end of the band usually reflects a permanent shed, and the lower end a smaller or partly temporary structure.

What documents are required?

How to apply for the sericulture loan

1. Ask the Primary Cooperative Agriculture and Rural Development Bank in your taluk whether the sericulture line is currently open, given the refinance position. Do this before spending on documents.
2. Meet the Department of Sericulture officer for your block or district. Get a written technical note covering the mulberry variety suited to your soil and water, the planting layout, the rearing house size for the crops you intend, and a costed estimate per acre.
3. Establish the irrigation position on paper. The pumpset registration, well details or ayacut entry: because "irrigated area" is the qualifying condition of this scheme and a verbal claim will not carry it.
4. Obtain the encumbrance certificate from the sub-registrar and an up-to-date patta, chitta and adangal from the village administrative officer or an e-Sevai centre.
5. Collect and complete the loan application form at the bank, attaching the land records, encumbrance certificate, irrigation proof, technical note and estimate, Aadhaar, address proof and photographs.
6. Obtain a no-dues certificate from the village primary agricultural cooperative credit society and any other cooperative institution you have borrowed from.
7. Subscribe to shares and complete membership formalities if you are not already a member.
8. Submit the file and collect a dated acknowledgement with the application number.
9. Execute the mortgage after sanction, then draw the instalments in stages, typically mulberry planting first, the rearing house next, appliances last, keeping bills, because the bank inspects before releasing each stage.

How to check the status of your application

1. Quote the application number to the secretary or manager of the PCARD bank.
2. Ask whether the delay is in title scrutiny, technical appraisal or funds. These are separate problems and only the first two respond to anything you can do.
3. Escalate to the Deputy Registrar or Joint Registrar of Cooperative Societies for the district.
4. Escalate to the Tamil Nadu Cooperative State Agriculture and Rural Development Bank, the apex institution of the long-term structure.

Why sericulture loan applications fail

• No refinance funds at the bank. The dominant constraint at present. Confirm before you begin.
• Land not irrigated, or irrigation not documented. This scheme is specifically for irrigated area; without a documented water source the file does not fit the unit cost applied for.
• Land not in the applicant's name, or held jointly and unpartitioned, so the mortgage cannot be created.
• Encumbrance on the land that has not been cleared.
• Default at another cooperative institution.
• No costed technical estimate. A sericulture loan cannot be assessed without a rearing house size, a leaf yield assumption and a crop plan.
• Rearing house planned too large for the mulberry area, or the reverse. The two must be matched, and a Sericulture Department officer will catch the mismatch before the bank does.
• Margin not brought in, causing the sanction to lapse.

Where to complain

• Secretary or manager of the PCARD bank, in writing.
• Deputy Registrar or Joint Registrar of Cooperative Societies for the district.
• Tamil Nadu Cooperative State Agriculture and Rural Development Bank, the apex institution.
• Registrar of Cooperative Societies, Tamil Nadu: rcs.tn.gov.in
• Department of Sericulture, Tamil Nadu, at the district office, for the technical and departmental-assistance side of the same unit.

Application forms are issued free at the bank. No agent can secure a sanction, and no payment should be made to anyone outside the bank's own receipts.