The Hindu : Tamil Nadu News : Minister hits the road for firsthand knowledge

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Sunday, Aug 01, 2004

Tamil Nadu

Tamil Nadu

Minister hits the road for firsthand knowledge

By S. Annamalai

MADURAI, JULY 31. The Union Finance Minister, P. Chidambaram, today embarked on a tour of rural bank branches and primary cooperative agricultural societies for a firsthand knowledge of the impact made by the Special Agricultural Credit Plan. Accompanied by top Ministry and bank officials, he visited rural branches of nationalised banks in Madurai and Dindigul districts.

In interaction with officials, creditors, loan seekers and self-help groups (SHGs) at Thanichayam, Vadipatti, Thathampatti and Ammayanaickanur, Mr. Chidambaram enquired about the level of lending for the priority sector and hassles in sanction of credit. He was keen on knowing about the quantum of lending to farmers and the SHGs and also grant of educational loans.

Mingling with farmers and the SHG members, the Minister gathered information about the norms adopted by each bank branch. Wherever there were complaints the manager was asked to have a relook at the loan application. He instructed the officials to make lending for higher education hassle-free.

Complaints galore

It was a rain of complaints from farmers at the Neerethan Primary Agricultural Cooperative Society, near Vadipatti. Hit by consecutive drought, the farmers were sore that the society had stopped lending for the past five months.

Even jewel loans were not forthcoming, a farmer leader said. They also pointed out that only Rs. 6 lakhs was given as farm loans against an outstanding of Rs. 42 lakhs.

Officials explained that loan dues had not been repaid due to drought and there were bad debts to the tune of Rs. 8 lakhs, advanced under the Integrated Rural Development Programme and Tamil Nadu Adi Dravidar Housing and Development Corporation schemes.

Why sickness

The members of the society attributed political interference and bogus membership to the sickness of such organisations and primary agricultural cooperative banks (PACBs).

They felt that contiguous PACBs could be merged to evolve a common banking system and make them viable. The Centre should formulate a package to revive the PACBs.

The farmers demanded that procedures be simplified for crop insurance. They were unhappy that politicians had not taken up restoration of the full level of the Periyar dam as seriously as they did raise the Cauvery issue.

Later, addressing newsmen at Ammayanaickanur, Mr. Chidambaram said the objective of his tour was to find out whether the details of the credit plan and debt relief package he announced on June 18 had reached the rural branches.

Tours of other States

Beginning August 4, similar tours would be undertaken in Karnataka, Orissa, Gujarat, Maharashtra, Bihar and Uttar Pradesh.

The Minister of State for Finance, S.S. Palani Manickam, and officials of the Ministry would undertake the tour.

"The advent of the new Government should create a new awareness among bank officials," Mr. Chidambaran said. More educational loans would be sanctioned for any recognised degree course.

Expressing concern over the status of PACBs all over the country, he said, "We have to contemplate radical changes in their structure and functioning."

A task force was constituted and the Government would act on its recommendations.

No need for panic

Mr. Chidambaram assured depositors of the Global Trust Bank that there was no need to panic and the Reserve Bank of India had approved its merger with the Oriental Bank of Commerce "with my full consent."

Top officials of State Bank of India, Central Bank of India, Canara Bank, Indian Bank and Indian Overseas Bank accompanied the Minister.

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