Telangana Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka on Tuesday, 10 November 2026, called on banks to restructure or reschedule crop loans for eligible farmers in line with Reserve Bank of India (RBI) guidelines, citing severe drought conditions triggered by the El Niño phenomenon. The appeal was made at the State Level Bankers' Committee (SLBC) meeting in Hyderabad, where the state government flagged alarming gaps in farm credit delivery ahead of the Rabi season.

Scale of Drought and Loan Gaps

365 mandals spread across 31 districts have been declared drought-affected, with 111 mandals classified as severely impacted. The monsoon's failure has left approximately 10 to 15 lakh borewells dry, with groundwater levels failing to recharge adequately. Water storage in reservoirs has dropped sharply following an absence of floods in the Krishna and Godavari rivers this year.

Against this backdrop, the state government expressed concern that only 53% of the ₹96,943 crore loan disbursement target — set for the period ending September 2026 — has been achieved so far. More critically, monsoon farming loan disbursement has reached just 17% of its target, a figure officials described as deeply inadequate given field conditions.

Key Demands from the Government

Vikramarka urged banks to promptly sanction the ₹38,268 crore in crop loans earmarked for the Rabi season, stressing that field-level bankers must take initiative to avoid delays. He insisted that the monsoon's failure must not be allowed to damage the financial relationship between farmers and the banking system.

Special priority, he said, should be extended to small and marginal farmers, tenant farmers, and families dependent on agriculture-allied sectors. Banks were also advised to spread awareness about debt relief measures available to affected farmers, and to coordinate with District Collectors, Agriculture Department officials, and Lead District Managers to implement RBI guidelines at the ground level.

Agriculture Minister Flags 'Super El Niño' Impact

Agriculture Minister Tummala Nageswara Rao urged bankers to treat the current crisis as requiring action beyond routine banking operations, specifically citing the 'Super El Niño' phenomenon as the driver of the rainfall deficit. He stressed that bankers themselves should take the lead in reaching out to farmers, so that distressed cultivators are not compelled to make repeated visits to bank branches.

The minister called for immediate rescheduling or restructuring of crop loans in drought-affected mandals in accordance with RBI guidelines, warning that both Kharif and Rabi crops face compounded risk from the depleted groundwater situation.

Diversification and Alternative Livelihood Push

Beyond emergency credit, the state government called on banks to support a structural shift in farm practices. Financial backing was sought for low-water-consuming crops, crop diversification, micro-irrigation, storage and processing infrastructure, and Farmer Producer Organisations (FPOs). Vikramarka also suggested that banks help create alternative income sources for farming families, with a target of providing additional employment opportunities to at least 10 to 15% of these families in the current season.

He further urged a proactive approach on educational loans and individual home construction loans, signalling that the government views the banking sector's role as extending well beyond agricultural credit in the present crisis.

What Happens Next

Officials indicated that District Collectors and Lead District Managers will be tasked with coordinating field-level implementation of the RBI restructuring guidelines. The banking community is expected to submit a special action plan to support drought-hit farmers during the Rabi sowing window, with the state government monitoring disbursement progress closely.