Financial Daily from THE HINDU group of publications
Thursday, Sep 19, 2002

Port Info

Group Sites

Industry & Economy - Economy

Joint forum mooted to bridge credit demand-supply gap

Our Bureau

KOLKATA, Sept. 18

IN order to bridge the gap between demand and supply of credit for sustaining the industrial growth of West Bengal, it is essential to go beyond the ritualistic meetings of State-level bankers' committee, and create a joint forum comprising representatives of banks, financial institutions and chambers of commerce and industry representing both large and small industries and trade.

Making a presentation at Fintech '2002 (conference-cum-exhibition), organised by the Confederation of Indian Industries, Eastern Region, here, Dr Asim Dasgupta, State Finance Minister, said the proposed committee should have district-wise chapters, and work out a joint action plan for credit for production, investment and infrastructure as well as recovery of credit by involving local farmers and entrepreneurs through panchayats and municipalities.

The Minister called for a collective pledge to make efforts to increase the credit-deposit of the banks by at least 10 per cent and also raise the share of assistance of all-India financial institutions by at least 3 per cent within 2002-03, for not only West Bengal, but for the entire eastern region and relevant States of Central region as well.

Stressing the need for adequate provision of credit in rural areas, he said it has been estimated, by using standard banking norms, that the total annual requirement of production and credit in agriculture and allied sectors in the State was at least Rs 10,000 crore. And against this annual requirement, the actual credit disbursement in 2001-02 has been only Rs 963 crore, with Rs 414 crore from commercial banks and Rs 549 crore from cooperative banks.

On the much-maligned loan repayment record in the State, he said that as per the latest available data (March 2001), the repayment record in West Bengal was now around 55 per cent, which compared favourably with the national average.

Suggesting that the growth impulse, so essential for industrial resurgence, was now being witnessed, Dr Dasgupta said not only has there been an increase in total production in agriculture and allied sectors (the basis of this increase is said to be land reforms), there has also been an improvement in economic conditions of the common people in rural areas, resulting in the growth of an internal market for industrial goods.

He said that if this growth has to be sustained, it was essential to support the credit requirements of the industrial sector, particularly of the small-scale units in the State. Quoting the Working Group report of the Planning Commission, the Minister said the total annual requirement of credit for the State SSI sector has been estimated at Rs 3,200 crore. Against this, he put the actual availability of credit at around Rs 300 crore for 2001-02.

Urging the various constituents to adopt a partnership approach whereby the Government, financial institutions and the private investors could come together for development, Mr Mrigendra Pratap Singh, Finance Minister of Jharkhand, said the FIs would increase credit flow along with assurance of adequate support towards a recovery mechanism from the Government.

He said the Jharkhand Government had set up a high-level committee under the State Finance Secretary to examine the various financial rules and regulations of the Government and especially to examine if private sector banks could be involved in tax collection and other Government transactions.

Highlighting the State's fiscal discipline, Dr R.C. Singh Deo, Finance Minister of Chattisgarh, said no extra-budgetary borrowings had been resorted to by the State Government. Pointing out that the State has not yet set up a State Financial Corporation, he said commercial banks have been urged to take care of the needs of the industry till such time the machinery was in place for creation of SFCs.

Send this article to Friends by E-Mail

Stories in this Section
Crafting a biz out of furniture

`Task force report on chem sector will be implemented'
Chemical cos asked to cut pollution
Let the auditors work more
Joint forum mooted to bridge credit demand-supply gap
RBI bid to limit debt payments of States
IMF sees signs of revival
Villagers end up spending more on urban products
SSP manufacturers seek level field
Pharma sector asked to tap Latam market potential
Lower advance tax hits mop-up
Finance Act implications — Excise Dept faulted on service tax provision
AP Govt to streamline commercial tax collection structure
`PTA may hit textile exports'
HYPO relief for 220 mills in South
Arrears to weaving co-operatives
Sarabhai space centre contests for students
Lower taxes will see more car sales: Crisil
Apparel Park to get Rs 17-cr Central aid
Oct 17 deadline for divestment review panel — Samata Party flexes muscles
Naik not against strategic sale of state-owned cos
Deepak Fert submits price bid for RSP unit
Cabinet defers move on hiking FDI cap
WTO: The punching bag!
`Plan funds for local bodies to be utilised fully'
Kappalur estate units' plea to Govt
How much must a CEO take home?
Hyderabad Engagements
I-T dept survey at DD premises
Exporters protest decision to relocate DGFT offices
Rs 2.87 cr for tourism works

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | Home |

Copyright 2002, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line