West Bengal ranks first in paddy production and comes second in potato. Yet, when it comes to bank loans for farmers, the state ranks behind Orissa, a state notorious for its pockets of abject poverty, and is way behind Andhra Pradesh.
And, this makes finance minister Asim Dasgupta an unhappy man.
“This year, we have set a target of Rs 5,000 crore for credit disbursement in agriculture and allied activities. I am sorry to state that we are behind Orissa, which has disbursed Rs 6,000 crore, and Andhra Pradesh, where agri-credit has touched Rs 20,000 crore,” Dasgupta said while addressing the 100 th state-level bankers’ committee meeting in Kolkata on Wednesday.
Last year, banks in the state extended Rs 3,850 crore for agriculture, which was behind the set target by 10%, he said. The state needs Rs 10,000 crore of agri-credit, according to him.
Dasgupta said West Bengal lags behind Orissa even in terms of credit-deposit ratio — a measure of how much of money raised through deposits in a state is lent back.
“In 2006-07, credit deposit ratio has grown to 66% from 60% in the previous year. It is behind Orissa’s ratio of 78% while in Maharastra the figure is 74%,” Dasgupta said.
Such a gloomy scenario couldn’t however deter Dasgupta from announcing an ambitious target to get every person in the state have a bank account by 2011. “We are now proposing 100% financial inclusion by the end of the 11 th plan period,” Dasgupta announced.
Health and panchayat minister Surjya Kanta Mishra pointed out that achieving the target is quite a difficult task and called upon the public sector banks to own this initiative.
Hooghly, Dasgupta claimed, has already achieved full `financial coverage’ and according to Mishra, the state has already identified 4,612 villages initially where the project would be launched.
Usha Thorat, deputy governor of the Reserve Bank of India, said there is a need to invest heavily in technology and reduce banking transaction costs if the state wants to achieve 100% financial inclusion.
“It’s not possible to set up branches everywhere, which is a costly proposition. We need to reduce transaction costs by providing banking services through business correspondents who would use handheld devices for delivering most of banking services,” she said.
RRB RECAPITALISATION
West Bengal need to invest Rs 50 crore in three regional rural banks in the state if it wants to improve their financial position. “The total requirement for recapitalisation of three RRBs in the state is about Rs 330 crore, of which share of the state government at 15% would be about Rs 50 crore,” Thorat said at the state-level banking meet.
“The recapitalisation could be through bond issuance and banks and the central government could put in their share and the RRBs can be recapitalised and grow their balance sheet,” the RBI deputy governor said.
The three banks are: Uttar Banga Grameen Bank sponsored by Central Bank of India; Bangiya Grameen Bikas Bank sponsred by United Bank of India and Paschim Banga Grameen Bank supported by Uco Bank.
For all the 96 RRBs in the country, recapitalisation requirment is Rs 1,800 crore, Thorat said.
