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G.K. Nair

Kochi , Dec. 15

DESPITE the huge NRE deposits in the banks in the State, the flow of assistance from financial institutions to the returnees from overseas employment continues to be very thin.

The NRE deposits in Kerala has been showing a phenomenal growth, and it has gone up from Rs 2,304 crore in 1991 to Rs 28,871 crore as on June 30, 2003. It was Rs 24,534 crore in 2002.

According to official sources, while the banks supported several developmental programmes for entrepreneurship development, the non-resident Keralites (NRKs) were not considered as a target group. They pointed out that State Bank of India was instrumental in mooting the concept of an NRI Growth Fund, but the idea did not materialise.

Banking sources said that the banks had recognised that the returnees fall into three broad categories viz., (a) those who have returned home without any substantial savings, (b) those who have made savings which are not adequate to start a meaningful industrial unit, and (c) those with adequate resources.

Of these the last group, who had concrete ideas about what they want to do, were being provided with financial assistance as well as other business guidance within the ambit of the banks' operational sphere.

The first group, on the other hand, suffered the most because they had very little technical ability and could not find margin month. The only manner in which the bank could have helped was by giving loans up to Rs 5 lakh without collateral security under a very recent directive from the RBI.

There are schemes under which the Government could provide them with margin money and project identification. The second group was the one, which sought bank assistance for small industrial or other business units and could be successfully helped.

The banks were not against giving priority treatment to the NRI, but do not believe that any such treatment would be helpful as long as they are unable to choose a viable project themselves and are sincere about it.

Officials of the banks were of the view that most of the returnees who approached them were motivated more by an interest in the subsidy and other non-returnable financial assistance than in genuine business. The banks were ready to assist those genuine entrepreneurs with finance as well as free entrepreneurship development training.

It was urged that the Government or other agencies should select groups of returnees willing to follow the banks' norms and genuinely interested in business ventures so that the banks can arrange special training facilities to suit their particular needs.

In fact, many of the migrant workers remit home a substantial part of their earnings and repatriate the savings on transfer of residence. Most of these are spent on acquiring land, constructing houses, buying consumer durables and social obligations such as marriages, medical treatments etc., thus leaving them with little funds for productive investment.

On the other hand, the opportunities of alternative employment at home are limited. Therefore, the only other choice is the entrepreneurship, says Dr J.M.I. Sait, former Director, UNIDO.

The State Governments were requested by the Centre in 2002 to set up societies to guide and assist returning migrants for their rehabilitation through self-employment, skill up-gradation or wage-paid employment programmes.

The total number of Keralites living outside the State permanently, according to a report of the Kerala Department of Health Services in 1998, was 20,53,649. Of this 6,91,695 were those living in other States permanently, while 13,61,954 outside India. Migrants living outside India who returned after a while stood at 7,39,245, while those living in other States returned after a while were at 9,58,826. Thus, the total number of those returned was 16,98,071.

An overall measure of the impact of migration on the Kerala households is given Migration Prevalence Rate (MPR), which is the ratio of the total of migrants from an area to the number of households in that area. Pathanamthitta district has the highest MPR of 99 per cent, while the State average is 59 per cent. MPRs of the lowest range were recorded in Idukki - 12 per cent, Alappuzha, Thrissur and Malappuram recorded a level higher than the State average.

Destination-wise data on migration indicates that Saudi Arabia topped the list with 38.1 per cent (5,19,000), following by UAE 29.7 per cent (4,05,000) and other Arabian countries 25.9 per cent, leaving 6.3 per cent for other countries.

Malappuram topped in the number of migrants with 57 per cent followed by Kottayam 51 per cent, 50 per cent from Ernakulam district and 23 per cent from Pathanamthitta district had Saudi Arabia as their destination. For emigrants from Pathanamthitta and Idukki, a major destination was US.

According to the Department of Economics and Statistics, there were 13.84 lakh of migrants of which 11.40 lakh were employed overseas while the remaining 2.44 lakh were their dependents. Almost three-fourth of the amount sent to Kerala was received through banks. As much as 894 persons out of 1,000 migrants from Thrissur district passed on their remittances through bank channels, while in Malappuram only 561 out of 1,000 resorted to the bank route.

In Kasargod district, 265 persons out of 1,000 forwarded their remittances through friends while in Malappuram 127 persons out of 1,000 used "other means", a report said.

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