The Hindu Business Line : Nabard releases Rs 424 cr for coop revival in AP

The National Bank for Agriculture and Rural Development (Nabard) has released Rs 423.64 crore as the first tranche of recapitalisation assistance towards the Union Government share on behalf of 1,506 out of 2,738 Primary Agricultural Cooperative Societies (PACS) affiliated to 22 District Central Cooperative Banks (DCCBs) in Andhra Pradesh.

The Union Government’s share had been released pursuant to release of its share of Rs 78.64 crore recently. It may be noted that the revival package for cooperative credit structure in the State is being implemented now following a MoU between the Government of Andhra Pradesh, Union Government and Nabard signed in August 2006. The recapitalisation assistance would help the eligible PACS to wipe out the accumulated losses on account of agriculture and other credit businesses, non-credit businesses such as distribution of inputs such as fertilisers, pesticides and seeds, PDS business, settlement of State Government dues such as interest rebates, and to increase the share capital to achieve a Capital to Risk Weighted Assets Ratio (CRAR) of 7 per cent as on the cut-off date (March 31, 2004), according to a release.

The losses are being determined by the conduct of special audit of PACS devised and supervised by Nabard.

In the first phase, recapitalisation assistance was being released to 1,506 PACS having a recovery level of 50 per cent and above as on June 30, 2004. The assistance for the remaining PACS coming under second and third categories (recovery level between 30 per cent and 50 per cent and less than 30 per cent) would be considered only if they achieve the benchmark recoveries as on June 30, 2006, and June 30, 2007, the release added.

Nabard was also planning to organise massive capacity building training programmes for the PACS functionaries such as secretaries and board members to develop a new brand of cooperative leadership focusing on good governance and improving performance. This would be followed by training on new business opportunities that could be considered by the PACS for expansion of their present operations.

Besides, a common accounting system and computerisation to ensure transparency and uniformity in the maintenance of accounts were being implemented, the release said.

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