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| JK CM asks Bankers to focus on traditional economy driving sectors | | Rather emphasizes on achieving national benchmark in advances |  Srinagar, May 28 (Scoop News) – Chief Minister, Omar Abdullah Monday asked the Bankers to strike balance in the credit flow and the deposits ratio to ensure focused attention on priority sectors like agriculture, MSME, handicrafts, education, entrepreneurship development and micro credit to give considerable fillip to the traditional drivers of State’s economy.
Addressing the 85th meeting of Jammu and Kashmir State Level Bankers’ Committee (SLBC) here this morning, the Chief Minister said that the growth registered in the deposits should necessarily reflect its positive impact on the credit flow to ensure benefits to the people especially in the priority sector.
“When there will be gap between deposits accumulation and credit flow then an important question arises for bankers to explain. It is also difficult for the government and the people to understand this hiatus in the process of normal banking procedure and practice”, he said adding that the flight of economy need to be checked by ensuring investment of deposits within the State itself in consonance with the targets fixed at SLBC for lending of money to people in the State.
Making reference to the issuance of Kissan Credit Cards to the farmers, Omar Abdullah said that noteworthy achievement has not been registered on this significant front which directly relates to the State’s agriculture economy and the welfare of peasant fraternity. He fixed the target of first week of October 2012 for the Banks to fulfil hundred percent achievement in the issuance of Kissan Credit Cards to farmers so that they avail the opportunity of taking loans for agriculture operations.
“You should constitute Sub-Committees to monitor this aspect and the aspect of lending loans to the priority sectors in a hassle-free manner”, he said and also directed for identifying zonal level nodal banks for ensuring issuance of Kissan Credit Cards to the farmers. He said artisans, small entrepreneurs and others in education, micro credit, employment generation and agro allied sectors should be focused in lending loans to them to flourish their economy.
Citing the case of importance of providing finances to the people associated with tourism, Omar Abdullah said that the growth of this sector and the necessity of help for its development can be underlined by the fact that as against 1.4 lakh visitors visiting the valley during the last year so far, figure this year has touched to over 4 lakhs in the same period. “Banks have to play their part in helping the traders in this field to develop befitting infrastructure and transport facilities. You can advance loans for tourist vehicles, buses and other transport in this sector also”, he added.
Describing handicrafts, tourism, agriculture, horticulture and allied sectors as traditional economy drivers in the State, Omar Abdullah said that proper credit flow to these sectors should be the focused area of Bankers. He said that credit flow from Banks to the housing sector, which has shown remarkable growth during past some years, should not be at the cost of other priority sectors. “You cannot create priority within the priority sector”, he said stressing on full target achievement in the priority sector taking care of all fields identify under this sector.
The Chief Minister also talked about incorporation of modern system of electronic transfer of benefits to the people down below. He said under MGNREGA government is launching a pilot project of transferring benefits to the beneficiaries in 10 districts which will be expanded to other districts gradually. He asked the Banks to look into this initiative and work out a feasible strategy.
“In order to achieve the targets full and reach out to the people extensively in the priority sector, I would like you to revisit your credit plan and reorient it in accordance with the requirements of people and the sectors identified as important in the economy of the State”, he said adding that Reserve Bank of India (RBI) should introduce a system of penalizing those banks which show shortfalls in registering targets they agree and commit to fulfil in SLBC meetings.
Speaking on the occasion, Minister for Finance, Abdul Rahim Rather said that while State Government is committed to render all help to the Bankers for their growth, development and security of assets, it at the same time expects the Banks to deliver conspicuously on the front of credit flow.
“We observe remarkable growth of the deposits in the Banks but the flow of credit has shown decline”, he said adding that this is the area of concern and Bankers have to focus on this issue. He told them to adhere to the targets fixed in SLBCs and come up to the commitments made to people.
Rather said that in a State like Jammu and Kashmir where resources are meagre and dependence of credit flow is mostly on Banks, the Bankers have to rise to the occasion and help give necessary fillip to the economy especially in agriculture and allied sectors identified as priority area in credit flow.
The Minister also impressed upon the bankers to work for achieving the national benchmark of 18 percent of the total credit for agriculture sector. “This is imperative to give boost to the rural economy”, he said and stressed on achieving the flow of lending money to the agriculture sector as per the targets fixed.
Rather also talked about huge finances advanced in the housing sector and said that this should not be done at the cost of other priority sectors like agriculture. He also negated the system of creating priority within the priority sector underlining the need for ensuring achievement of targets in all fields of priority sectors to the full.
The Minister said that the national target of 18 percent credit flow to agriculture sector out of the overall advances percentage should be adhered to and ensured that this national benchmark is achieved satisfactory. He said though there is some increase observed on advances made in the agriculture sector yet the pace is not as fast as is expected. He stressed on proper focusing in this area.
The meeting was participated by Chief Secretary, Madhav Lal, Principal Secretary Finance, M. Iqbal Khandey, Principal Secretary Planning and Development, B. B. Vyas, Chairman Jammu and Kashmir Bank, Mushtaq Ahmad, Director Finances in Union Ministry of Finance, Regional Director of RBI, CGM, NABARD, various Principal Secretaries, Commissioner Secretaries, Heads of the Departments and Bankers operating in Jammu and Kashmir.
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