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Sunday, Nov 24, 2002

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Nabard union not for privatisation

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THE central executive committee (CEC) meeting of the All-India Nabard Employees Association (AINBEA) being held here has expressed serious concern over the reported move of the Reserve Bank to divest its stake in the apex National Bank for Agriculture and Rural Development (Nabard) in line with the recommendations of the Narasimham Committee-II.

Viewed in conjunction with the amendment to the Nabard Act, 1981, carried out in December 2000 paving the way for off-loading up to 49 per cent in Nabard equity into private hands, this will open the floodgates leading to the total privatisation of the apex bank, the association said in a special resolution passed on the occasion of the CEC session.

This, it feared, would have serious implications for the millions of marginal farmers of the country who have been the main beneficiaries of Nabard finance so far. These people are already being deprived of institutional bank credit, especially in the decade since the 1990s in the wake of the new economic policy.

RBI's move will also weaken Nabard's financial strength, causing immense harm to any effort to boost agricultural credit which has looked down substantially from 13.5 per cent of bank credit in 1994-95 to 9.9 per cent in 2000-01.

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