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Kerala - Kozhikode Printer Friendly Page   Send this Article to a Friend

Package for ryots sought

Staff Reporter

Many committed suicide due to huge debts, says MCC


Seeks plastic notes for small denomination

Wants Bank Cash Transaction Tax withdrawn


Kozhikode: The Malabar Chamber of Commerce (MCC) has urged the Reserve Bank of India (RBI) to initiate a special package for farmers after many committed suicide due to mounting debts in Wayanad district.

In a memorandum submitted to the RBI Deputy Governor, V. Leeladhar, who was here last week, MCC president P. Zakeer and secretary K.P. Aboobacker said that many farmers of Wayanad had committed suicide because they were unable to repay the loans taken from banks. They had taken loans from banks anticipating optimum prices for crops. However, the price of every cash crop plummeted in the last few years. Apart from global competition, the farmers also had to counter the challenges of increased transportation rates and high cost of manure, they said.

Credit-deposit ratio

Mr. Zakeer and Mr. Aboobacker also requested the RBI to bring credit-deposit ratio of the State on a par with the national average. Although most banks in the State were getting huge deposits, especially from Non Resident Indians, the money remained unutilised in the State. The State, particularly its northern parts, lagged behind in industrial development. One reason for this was that the credit-deposit ratio was far below the national average, they claimed. They also wanted the RBI to reduce interest rates on loans and cash credit so as to promote trade and industry.

Another issue was the acute shortage of small denomination notes and coins in the State. Also, the currency notes were soiled easily. One option was to print plastic notes for small denominations. Singapore has successfully done this, they said.

They also demanded the withdrawal of the recently-introduced Bank Cash Transaction Tax. The tax will inconvenience companies employing a large number of people since they would have to draw cash from banks either weekly or monthly to distribute wages.

The memorandum also requested the withdrawal of the ceiling of Rs. 20 lakh for availing loans from banks using collateral security of NRI deposits.

Similarly the restriction imposed on lending to real estate sector had badly affected sectors such as education, tourism and hotel industry. The construction of buildings in these vital sectors should be exempted from the new rule, they said.

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