Rs 2,200-cr revival package to benefit 2,746 PACs, 22 DCCBs
The revival package is based on the recommendations of the Task Force constituted by the Centre under the chairmanship of Prof A. Vaidyanathan. The Centre has accepted the recommendations of the Task Force.
Hyderabad, Aug. 29
The Andhra Pradesh Government has agreed and decided to implement the revival package offered by the Union Government for the co-operative credit institutions in the State.
Accordingly, the State Government has entered into a memorandum of understanding (MoU) with the National Bank for Agriculture and Rural Development (Nabard) here on Tuesday.
The Nabard Chairman, Dr Y.S.P. Thorat, and the Principal Secretary of Cooperation and Marketing, AP, Mr G. Sudhir, have signed the MoU in the presence of the Chief Minister, Dr Y.S. Rajasekhara Reddy.
The total size of the revival package is of the order of Rs 14,839 crore for the country as a whole. The likely share of the Centre, State Government and the co-operative credit structure were estimated at 53 per cent, 31 per cent and 16 per cent respectively.
The revival package was based on the recommendations of the Task Force constituted by the Centre under the chairmanship of Prof A. Vaidyanathan.
The Centre accepted the recommendations of the Task Force in 2005.
Following the proposed revival scheme for co-operatives, as many as 2,746 Public Accounts Committees (PACs), 22 District Central Co-operative Banks (DCCBs) and the Andhra Pradesh Co-operative Bank (APCOB) would be recapitalised to the tune of Rs 2,200 crore.
The State Government, on its part, would contribute around Rs 500 crore for the revival.
The Chief Minister said the revival package would be implemented by March 31 next year and the amount of recapitalisation would flow to the respective institutions in the cooperative credit structure, making them fully vibrant with their lending activities from April next year.
The institutions comprising co-operative credit structure would have total freedom in their operations - both administrative and financial - in order to achieve the objectives fully, for which they were established, Dr Reddy said.
According to him, the MoU with Nabard was aimed at implementing the financial package along with legal and administrative reforms for the revival of rural cooperative credit system.
The new initiative was expected to bring in self-sustenance to the institutions and significantly benefit the farming community in the State.
The Chief Minister said that a lack of professionalism in managing the institutions had in the past lead to 19 out of the 22 DCCBs succumbing to financial bankruptcy.
The indifference and interference from past Governments had added to further deterioration of co-operative credit system in the State, he said.
The Nabard Chairman, Dr Thorat, said the financial package coupled with the structural measures would revitalise the rural credit structure in the State.
Further, he said, the rural cooperative credit institutions in the State would receive a recapitalisation assistance of at least Rs 1,500 crore.
He said the proposed assistance would depend on the full implementation of legal and administrative reforms by the State Government as envisaged in the MoU.
One-fourth of the proposed assistance would be released once the first stage of reforms was completed, Dr Thorat said.