The Hindu Business Line : <I>`Last chance to revive co-op sector' </I>

Delivering a speech at the valedictory of the centenary celebrations of Corporation Bank here on Sunday, Mr Chidambaram said that cooperative credit structure had completely collapsed.

Urging the need to revamp the cooperative credit structure, he said, "This is our last chance to revive it." Referring to the recommendations of the Vaidyanathan Committee, he said the State governments should determine to implement the recommendations of the report.

Citing a Rs 14,500-crore plan for the revival of the cooperative sector, he said two-third of this amount will be borne by the Central Government.

Mr Chidambaram urged the Karnataka Chief Minister, Mr H.D. Kumaraswamy - who was present in the function - to sign a memorandum of understanding with the Centre to implement the plan, and become the first Chief Minister to sign such an agreement.

Farm credit

Urging the bankers to provide agriculture loans at 7 per cent, he said most farmers are unaware of the availability of institutional credit..

He attributed the suicides of farmers to lack of access to institutional credit to them. "In such a situation, availability and pricing of credit is important," he said. Stressing the need for delivering credit to farmers at a rate of 7 per cent interest, he said that beginning from kharif 2006, farmers will getcredit at 7 per cent rate.

Though the Centre had asked the banks to double agriculture credit in three years, it appeared they would reach this target in two-and-half-years, he said.