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3. Money and Banking

n Deposits and Advance
n Comparative Data of Banks in HP
n Priority Sector Credit
n Government Sponsored Programme
n NABARD
n Rural Infrastructure
n Refinance Support
n Micro Credit
n Rural Non-Farm Sector
n Ground Level Credit Flow

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3.       MONEY AND BANKING  

3.1                   Banks have a great role to play in stimulating economic growth by strengthening agricultural,  industrial  and other self employment activities etc.  Banks are also credited with designing of social banking policies and programmes which support vital sectors of the economy as well as aim at poverty alleviation by benefiting number of farmers, artisans, professionals and self employed. 

3.2                   The total number of bank branches in the State including the branches of Regional Rural/Cooperative Banks was 1117 as on September 2001. There are 19 Commercial Banks operating in Himachal Pradesh through a net work of 653 branches of which 639 branches are located in rural areas. SBI, PNB, UCO and SBOP are the major Banks with 555 branches. There are two Regional Rural Banks in the state, namely, Himachal Gramin Bank and Parvatiya Gramin Bank with HGB having 103 branches and PGB 27 branches thus bringing the total number of commercial bank branches to 783.                        

3.3                   The Himachal Pradesh State Cooperative Bank Ltd. is an Apex bank under short-term credit structure. It has a network of 128 branches in six districts of H.P. viz; Shimla, Kinnaur, Bilaspur, Mandi, Sirmaur and Chamba. There are two central cooperative banks in the State namely Kangra Central Cooperative Bank Ltd.(KCCB) and Jogindra  Central Cooperative Bank Ltd.(JCCB) while KCCB with 138 branches operates in five districts viz; Kangra, Hamirpur, Kullu, Una and Lahaul & Spiti, JCCB with 20 branches covers Solan district.

                         The achievements made by these banks upto September,2001 are as below:-
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 Deposits & Advances 

3.4                         At the end of September, 2001 the Pure Public Deposit(PPD) of  banks covered under the lead bank scheme in H.P. stood at Rs. 10047.12 crore and the total out standing advances  amounted to Rs.2840.80 crore.  The deposit of banks have registered an increase of Rs. 1543.68 crore (18.15%) and total advance increased by Rs. 553.20 crore  (24.18%) during the 2nd quarter of the year. As a result of more credit  expansion the credit deposit ratio of banks in H.P. have increased to 28.3% as on September,2001 from 26.9% as on Sept.,2000.  
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 Table- 3.1

 Comparative Data of Banks in HP

                      (Rs.crore)

 

March, 2001

June, 2001

Sept., 2001

Present Trend

1.      Deposits(PPD):

Rural                       

      Semi Urban

      TOTAL

 

6396.15

3075.08

9471.23

 

6485.57

3106.09

9591.66

 

6864.90

3182.22

10047.12

 

+379.33

+76.13

+455.46

 

2.   Advances(O/S)

       Rural                                        

       Semi Urban

       TOTAL

 

1759.54

975.10

2734.64

 

1892.06

888.57

2780.63

 

1541.11

1299.69

2840.80

 

-350.95

+411.12

+60.17

 

3.   CD Ratio(PPD)

      Rural

      Semi Urban

      TOTAL

 

27.51%

31.71%

28.87%

 

29.17%

28.61%

29.00%

 

22.5%

40.8%

28.3%

 

-6.67

+12.19

-0.70

 

4. Investment made by banks in State           

     Govt. securities/Bonds

1507.28

1689.34

1773.89

+84.55

5. Investment Credit Deposit Ratio(ICD)

44.79%

46.60%

45.9%

-0.70

 

6. Priority Sector Advs.(O/S)

    under:

i)          Agriculture

ii)         SSI

iii)       Services

 

 

393.40

326.58

915.85

 

 

427.95

315.39

865.16

 

 

423.97

320.39

967.71

 

 

-3.98

+5.00

+102.55

 

7. Weaker Section Advances

551.12

569.13

576.37

+7.24

 

8. DRI Advances

1.30

1.86

4.41

+2.55

 

9. Advances under Govt. sponsored

programmes.

245.18

129.77

183.55

+53.78

10. Non-Priority Sector Advances

1098.81

1172.13

1128.73

-4.34

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 Priority sector credit

 3.5                           All the banks functioning in the state have disbursed total fresh credit to the tune of Rs.418.83 crore upto 2nd  quarter ending Sept., 2001  against an annual commitment of Rs.764.97crore, representing 54.75 percent achievement. The sector wise progress is given below:-

Table- 3.2

Sector

Annual commitment 2001-2002

Actual Achievement upto Sept., 2001

%age achievement

1. Agriculture

216.92

98.89

46

2. SSI

76.42

30.84

40

3. Services

316.84

165.52

52

Total Priority sector

610.18

295.25

48

Non-priority

154.61

123.58

80

Grand Total

764.79

418.83

55

                       

The credit coverage under the priority sector depicts an achievement of 48.39 % upto the end of Sept., 2001. The achievement under the SSI was significant as  40.36 % funds were utilised upto the 2nd  quarter of the current financial year.  
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 PERFORMANCE  UNDER  GOVT.  SPONSORED  PROGRAMME

 (a)            Prime Minister Rojgar Yojna

3.6                      Banks in Himachal have sanctioned 1,130 loan cases under this scheme upto September,2001 against the target of 3,000 loan cases. In total 802.02 lakh  rupees were sanctioned and 499.72 lakh rupees were disbursed under this programme upto September,2001.

 (b)            Swarn Jayanti Gram Sewa Rojgar Yojna

 3.7                      Under this scheme, 2726 cases of individual Sewa Rojgari were received in the banks, out of which 1922 proposals were sanctioned with an amount of Rs.549.14 lakh and 1,663 proposals with an amount of Rs.446.69lakh were disbursed  upto the end of September,2001 . Under group financing scheme 259  group loan cases with an amount of Rs.345.37 lakh were sanctioned and Rs. 270.27 lakh were disbursed to 248 groups upto September,2001.

 (c)            Swarn Jayanti Shahri Rojgar Yojna 

3.8                     The SJSRY urban poverty alleviation and employment generation scheme is implemented by Municipal bodies in all towns of H.P. The convener bank has received a target of 236 units under USEP and 57 units under DWACRA for 2001-2002.

 (d)            Scheme for Liberation and Rehabilitation of Scavengers 

3.9                     The banks in H.P. have sanctioned 160 loan cases with an amount of Rs.54.03 lakh under this scheme upto September,2001 and 154 cases have been disbursed   an amount of Rs.52.88 lakh.

 3.10                 Besides above, 179 cases with an amount of Rs. 1003 lakh have been sanctioned under  KVIS margin money scheme upto September,2001 disbursing an amount of Rs.901.00 lakh to 172 cases.
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 NABARD  
 

3.11                 The National Bank for Agriculture and Rural Development (NABARD) had strengthened its association with the developmental process substantially for integrated rural development in the recent years by initiatives encompassing a wide range viz Watershed Development, Rural Infrastructure, Micro Credit, Rural Non-Farm Sector, Minor Irrigation, besides strengthening the rural credit delivery system in the state. The heightened and active support from NABARD is generating tremendous social and economic benefits in the rural areas of the state.  
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 Rural Infrastructure

     3.12                 Government of India had created Rural Infrastructure Development fund(RIDF) in 1995-96. Under this scheme, loans are given to State Governments and State owned Corporations for the completion of on-going projects as also to start new projects in certain selected sectors. This scheme has also been extended to Panchayati Raj Institutions, Self help groups and Non-Government Organisations for development of various location specific infrastructures having a direct bearing on society and the rural economy.

 3.13                 Financial assistance of Rs.531.26 crore has been sanctioned to the H.P Government upto 31st  Dec.2001 for taking up 2433 projects in the diversified sectors like Irrigation, Roads and  Bridges, Drinking water supply, flood protection, water shed development, construction of  buildings for primary schools and schemes under information technology like ‘Lokmitra’.

 3.14                 During the current financial year i.e 2001-2002, upto 31st December an amount of Rs.76.95 crore has been sanctioned under RIDF and it is expected to exceed Rs.150.00 crore by the close of the financial year. The cumulative disbursement made to the State Government upto 31st Dec.,2001 was Rs.292.36 crore.

 3.15                 After the implementation/completion of the sanctioned projects, 29635 hectares  additional  land  will  be  brought  under  irrigation,  2327  K.M.  Road  will  be

metalled, construction of 3461 mt. Span bridges will be done,  flood protection to 2256  hectares of land, 133 villages will be covered under water shed projects, besides achieving various Economic and social benefits. The roads and bridges to be constructed under RIDF shall provide improved connectivity to 1812 villages of the state.  
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 Refinance support

 3.16                 Financial support to banks for diverse activities viz Minor Irrigation, Plantation and Horticulture, Farm mechanisation, Road Transport, Land Development, Animal Husbandry, micro Credit, SGSY,Crop Loans, rural non farm sector, is expected to increase from Rs. 89  crore in 2000-2001 to Rs. 104.00 crore in the current year and reach Rs. 120.00 crore in 2002-2003. NABARD has been laying emphasis on enhanced credit flow for irrigation and horticulture projects specially for tea, medicinal and aromatic plantations.  
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 Micro credit 

3.17                 The SHG movement has spread across the state except Kinnaur district and is now on a firm base. The movement has been upscaled with support in the human resources and financial products. Grant assistance of Rs.3.43 lakh was extended to various agencies during the year for strengthening the movement. There are more than 11000 SHGs operative in the state promoted by Department of Social and Women Welfare and NGOs. During the year, 1518 SHGs were credit linked as on 31st December 2001 with a bank loan of approximately Rs.3.00 crore. Cumulatively, 4291 Self Help Groups have been credit linked with the banks. At present, 375 bank branches are associated with micro credit movement. An amount of Rs. 5.00 crore has been extended as refinance assistance to the banks.  
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 Rural Non-Farm Sector 

3.18                 During the year, 7 Rural Entrepreneurship Development Programmes(EDPs) were sanctioned for the benefit of rural youth intending to set up small enterprises in the rural area, of which 5 REDPs have been conducted upto 31st Dec.2001. The grant assistance of Rs.3.29 lakh was sanctioned for this purpose to NGOs and other professional bodies. The activities like white metal jewellery, carpet weaving, cutting and tailoring  were covered. District Rural Industries Project (DRIP) has been launched in Solan district from April,2001 whereas Mandi district has been selected for launching DRIP during the next financial year. The initiatives for developing clusters in Solan, Kullu and Kangra districts were supported.  
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Ground Level Credit Flow

 3.19                 NABARD has formulated a potential linked credit Plan for 2002-2003 and has accordingly updated the 10th Five Year Plan. The credit flow at the ground level during 2002-2003 has been assessed at Rs.980 crore. The credit flow was mainly under Agriculture and allied activities, non-farm sector and other identified priority sectors.

 3.20                 NABARD continued to extend support to the rural financial institutions especially Co-operative Banks and Regional Rural Banks in the State

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