Agriculture finance, low-cost housing and small industries are expected to remain as the key areas for boosting credit assistance in Budget 2009-2010 to be presented next week. The government plans to infuse funds into institutions such as Nabard, Sidbi and the National Housing Bank (NHB) to continue with its focus in these areas especially after the slowdown hit the Indian in economy in the third quarter last year. As much as Rs 9,000 crore of funds may go to these institutions in the Budget on Monday, according to top finance ministry officials.

“The government plans to continue to provide better access to credit to these sectors that have been affected by the downturn. Even as exemptions and relief was brought to the micro, small and medium enterprises (MSME) sector and the housing sector in the fiscal stimulus packages, funding plans are being worked out yet again,” a finance ministry official said.

Sidbi is expected to get around Rs 3,000 crore or more this year for providing re-finance facilities catering to MSMEs alone. As far as the National Housing Bank is concerned the government plans to infuse Rs 1,000 crore into the institutions in an attempt to give fillip to low cost housing solutions. There has been an increase in focus on low cost housing not only within the government but also the private sector which has found that this segment of housing can be a completely new market that can generate business.

The government also plans to extend funds worth Rs 5,000 crore to Nabard for providing finance for agricultural activities. This year is expected to be tough for agriculture with the monsoons getting delayed. Last year the government had waived loans of small and marginal farmers totalling to over Rs 70,000 crore under its farm loan waiver scheme. Even as these fund infusion estimates have been key to finance ministry discussions, the final view will be taken by the finance minister himself.