SLBC of Andhra Pradesh
Date: 30.12.2010
Time: 3.00 pm
Venue: Jubilee Hall, Public Gardens, Hyderabad
STATE LEVEL BANKERS’COMMITTEE OF A.P
CONVENOR :: ANDHRA BANK
Head Office, Andhra Bank, Dr.Pattabhi Bhavan, Saifabad, Hyderabad - 500 004
Phone : 040-2323 1392(D) 2325 2000 Extn :2375, 2387
Fax : 2323 4583 & 23232482
Email :
Website: slbcap.nic.in
172nd Meeting of the SLBC of Andhra Pradesh was conducted on 30.12.2010 at Jubilee Hall, Public Gardens, Hyderabad at 3.00 p.m.
Shri B Narendranatha Reddy, Convenor, SLBC of Andhra Pradesh welcomed the dignitaries on behalf of SLBC of Andhra Pradesh to the 172nd Meeting of SLBC.
Shri R Ramachandran, Chairman & Managing Director, Andhra Bank & President, SLBC of Andhra Pradesh, in his presidential address has extended a warm and hearty welcome to Sri. N. Kiran Kumar Reddy, Hon’ble Chief Minister, Govt. of Andhra Pradesh, Sri. Anam Ramanarayana Reddy, Hon’ble Minister for Finance, Planning, Small Savings, Govt.of Andhra Pradesh, Sri. N. Raghuveera Reddy, Hon’ble Minister for Revenue, Relief, Rehabilitation, Sri. Y. S. Vivekananda Reddy, Hon’ble Minister for Agriculture, Agriculture Technology Mission, Sri. Dokka Manikya Vara Prasada Rao, Hon’ble Minister for Rural Development, NREGS, Sri. Kasu Venkata Krishna Reddy, Hon’ble Minister for Co-operation, Smt. Sunitha Laxma Reddy, Hon’ble Minister for IKP, SHG and Women Development and Sri. Kanna Lakshminarayana, Hon’ble Minister for Housing; Sri S.V. Prasad, IAS, Chief Secretary, Principal Secretaries, Secretaries, Commissioners, Directors, Heads of Departments of Govt. of AP, Officials from Government of India and Andhra Pradesh, Sri A.S. Rao, Regional Director, Reserve Bank of India, Executives from Reserve Bank of India, Mrs. Renu Challu, Managing Director, SBH, Sri Shiv Kumar, Deputy Managing Director SBI, Sri P. Mohanaiah, CGM, NABARD, Executives from other Banks, Chairmen- RRBs, Lead District Managers, the Members of Print & Electronic Media, Ladies and Gentlemen.
At the outset, President of SLBC of AP has extended a warm and hearty welcome to Hon’ble Chief Minister, who has attended the SLBC meeting for the first time. He said that they were indeed honored to have Hon’ble Chief Minister with them to guide in the deliberations. He said that he had equal pleasure in extending a very warm welcome to all the participants to the 172nd meeting of SLBC of Andhra Pradesh.
He informed the house that today’s meeting was convened with a special focus on Agriculture sector in view of the recent floods and heavy rains in Andhra Pradesh. He expressed that during the year the monsoon was generally good across the State and farmers were expecting bumper kharif harvest.
Unfortunately, due to heavy and incessant rains from 29.10.2010 to 04.11.2010 and due to JAL cyclone from 5.11.2010 to 8.11.2010, many areas of the state were affected by floods/ heavy rains. The State Government had declared 483 mandals in 13 districts as affected by floods/ heavy rains during that period. The vagaries of monsoon did not stop there. Unfortunately, between 05.12.2010 and 09.12.2010 due to depression in Bay of Bengal, additional 124 mandals were affected in four districts. The magnitude of loss to standing crops and animal life was enormous. As per the Government’s estimation, crops in about 16.28 lakh hectares were affected involving 31.77 lakh farmers. The loss of crop was by way of damage to the standing crop as also to the crop that was already harvested and ready for marketing.
The State Level Bankers Committee had immediately responded to the gravity of the situation and advised all the Lead District Managers and Controlling Authorities of respective banks in the first fortnight of November 2010, to initiate relief measures in the affected areas. A special steering committee meeting was also conducted on 20.12.2010 to discuss about the reschedulement of loans. All the Banks and Lead District Managers were once again advised to initiate the relief measures in terms of RBI guidelines on natural calamities. As per the broad action plan approved by the Steering Committee, Banks had in- principle agreed to reschedule the crop loans of the farmers in the affected areas and to extend further finance for crop production wherever fresh crops are being raised.
The President of SLBC drawn the attention of the banks that Reserve Bank of India had communicated comprehensive and updated guidelines to be followed by Banks in the case of natural calamities. SLBC had already brought the guidelines to the notice of all the Banks and Lead District Managers. The LDMs were advised to review the situation in their respective Districts by conducting Special DCC Meetings immediately, to finalize district specific action plan.
Banking system has done commendable job in the State in the field of Agriculture and Rural Development. On behalf of SLBC, the President of SLBC of AP has assured Hon'ble Chief Minister that all the Banks would act proactively at this hour of need and extend all the required assistance to the needy. President of SLBC appealed to all Banker colleagues to pay required attention to the problems of the distressed, to overcome the adverse impact on the rural economy.
President of SLBC of AP once again appealed to all his Banker colleagues to immediately sensitize all their field functionaries to review the situation in their operational area so as to extend necessary relief measures to the affected people. The prevailing situation warranted an urgent action by all of banks on a war footing.
Informing the position of lending under Agriculture sector, the President said that as per the data received by SLBC, Banks had disbursed crop loans of Rs.16,372 Cr. against the target of Rs.17,473 Cr. set for Kharif season with an achievement of 93.70% of the target . Under Agricultural term loans and allied activities, Banks have disbursed Rs. 8,606 Cr. as against the target of Rs. 8,609 Cr. for Kharif, 2010 achieving 100%. As per the provisional information available, Banks have extended Rs. 3,846 Cr as crop loans as against the target of Rs. 8,788 Cr during the Rabi 2010-11 by 24.12.2010. The progress under Rabi lending would have had been much better, but for the floods and heavy rains during November and December 2010. The performance of the districts/ banks where the progress was not up to the desired levels would be reviewed to suggest corrective measures to be initiated for meeting the targets.
In Andhra Pradesh State, Agriculture Department had taken initiative in enumerating uncovered farmers and tenant farmers. They were also organized eligible tenant farmers into Joint Liability Groups. They had enrolled over 7.37 lakh of uncovered farmers and formed 56,187 Joint Liability Groups (JLGs) during for the year. As per the provisional information available, Banks had already financed 6.46 lakh uncovered farmers and 9,030 JLGs covered 79,360 tenant farmers. To facilitate easy access of credit to tenant farmers, the State Government had recently issued guidelines on loan eligibility card. President of SLBC hoped that the problems of tenant farmers in the State would be addressed by the new system introduced. President of SLBC assured the Government that the banks would continue to focus on extending finance to uncovered farmers and tenant farmers. President of SLBC requested the Agriculture Department to extend necessary assistance to Bank branches by enlisting the affected farmers and provide the lists to Banks. This would enable the Branches in timely extension of relief and rehabilitation measures.
The major area of concern for the Bankers in the State is the incidence of Fake Pattadar Pass Books. The issue was discussed on several occasions. Government had also positively responded and initiated steps for handing over hard and soft copies of land records to the respective Bank branches. However, in some places, the exercise is yet to be completed and the process is continuing. President of SLBC requested the Hon'ble Chief Minister to take steps for introduction of fool proof land record system to address the problem.
President of SLBC had drawn the attention of the forum to the issues concern for recovery of the loans extended by the Banks. Banks had already in the process to meet the needs of the rural sector by extending timely credit. Unless there is a continuing thrust on prompt repayment culture, it is difficult for the system to sustain. He appealed to all the Government departments to extend necessary assistance to Banks in recovery, especially under Agriculture, SHG-Bank Linkage programme and Weaker Section Housing.
The overdues under Self Help Groups lending are mounting up and as at the end of October, the overdues were to the extent of Rs. 2,098 crores, constituting 16.42 % of outstanding, which at one point of time was as low as 5%. The recovery of these overdues was indeed a major concern for the Banks and President of SLBC requested the state government to extend necessary help in this regard.
Coming to the agriculture sector, a large number of crop loans disbursed during 2007 and 2008 were still remains unpaid. Due to this, renewals of these loans could not be taken up on time. Consequently, farmers were put to loss for the benefit of interest subvention and crop insurance. District level officials of Agriculture Department along with branch officials/ Lead District Managers of respective districts may have to collectively educate the farmers on these issues, so that overdue crop loans could be recovered and farmers would be benefited by further finance, interest subvention and crop insurance.
In Andhra Pradesh State, 6,699 villages were not having any bank branches having a population of above 2,000, had been identified for first phase of Financial Inclusion Plan (FIP). The Sub-Committees of District Consultative Committees had allotted these villages to different Banks for implementation of Financial Inclusion Plan to provide Banking service outlets by March, 2012 as per Govt of India / RBI guidelines. The banks had also set up their sub-target for implementation of FIP by March, 2011.
The Banks had commenced the implementation of FIP and were in different stages in different Banks. Most Banks have started enrollment of customers in the villages and the progress is being reviewed at SLBC level. A Special Steering Committee was also convened on 13.12.2010, wherein the performance of the banks was reviewed by the Secretary, Institutional Finance, Govt. of A.P. All the Banks had assured to implement the FIP and reach significant share of target by March, 2011.
President has proposed to SLBC that a Sub-Committee may be formed to review the progress and to see that all the villages having population above 2,000 are provided with banking outlet by March, 2012. There are about 18,080 villages with population less than 2,000. Banks have to implement Financial Inclusion Plan in these villages also by 31.3.2013.
On behalf of his fellow Bankers, President of SLBC once again assured Hon'ble Chief Minister that all possible help would be extended by the Banking sector to the farmers in distress in mitigating the present situation.
Hon’ble Chief Minister of Andhra Pradesh, Sri. N. Kiran Kumar Reddy expressed his pleasure in participating in the meeting with all the bankers in Andhra Pradesh and complemented the banks for extending excellent cooperation and support to the Government towards implementation of all the developmental schemes, aimed at benefiting the weaker sections of the community. He felt sad for the time of first meeting with bankers, which is being conducted in an unfortunate time when floods and cyclones in many part of the State caused misery to the most of the farmers as their standing crops are damaged.
Hon’ble Chief Minister expressed that Banks have played an important role in the economic progress of the State and he felt very happy to note that Andhra Pradesh state occupies number one position in the country in financing Agriculture sector. In Andhra Pradesh, agriculture lending had progressively improved from a mere Rs.9019 crores in the year 2003-04 upto Rs.37,753 crores by the end of 2009 – 10. This would have not been made possible but for the active involvement of all the banks in the state and he hoped that this would continue in the future.
Hon’ble Chief Minister said that loan is very important input for farmers for taking up cultivation. If banks are extending timely crop loans to farmers, farmers will not approach money lenders for their farming needs. The farmers are being exploited with higher rates of interest by the money lenders and when they could not pay, the recovery is made by money lenders by unfair practices and sometimes this is leading to suicidal deaths.
Hon’ble Chief Minister said that when the state was expecting good crop during this year, a series of natural calamities – Laila cyclone affected during the month of May, continuous heavy rains & floods in June to September, JAL cyclone in October- November followed by heavy rains and floods during the first week of December, 2010; had caused extensive damage in the state. This had left the farmers, particularly small and marginal farmers and tenant farmers in lurch, resulting in a spate of suicides.
He advised that this is time for all of us, the Government machinery as well as the banking community, to support the farmers who are in distress. He assured them of the support at this need of the hour, both financially and morally for creating a confidence among the farming community. He has requested all the bankers to extend whole hearted cooperation and urgent steps that are required to be taken to provide timely relief and assistance to the farmers. State Government has requested the Central Government for interest subvention, he informed. Central Government has provided an immediate relief of Rs.400 crores.
Hon’ble Chief Minister narrated the steps taken by the Government, like providing input subsidy, for the farmers especially for the tenant farmers who actually cultivated the land by investing money for the inputs by themselves and suffered because of the crop damage.
The Government of Andhra Pradesh has come forward to provide full interest waiver for the loans taken by the farmers for the Kharif and Rabi season 2010 – 11 upto March, 2011. The cost effect of this scheme is expected as Rs.350 crores, and the government has taken this step despite the severe strain on the resources of the Government.