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MINUTES OF THE 103rd

MEETING OF THE STATE LEVEL BANKERS’ COMMITTEE,HARYANA HELD ON 03.04.2008

The 103rd meeting of the State Level Bankers’ Committee, Haryana was held on 03.04.2008 to review the performance of banking system for the period ended Dec., 2007 at Hotel Taj, Sector-17, Chandigarh. Shri Pawan Kumar Bansal, Hon’ble Union Minister of State for Finance, was the Chief Guest and Dr. K.C.Chakrabarty, Chairman & Managing Director, Punjab National Bank presided over the meeting.

Shri R.K.Gupta, General Manager, Punjab National Bank, Convener, SLBC, Haryana extended warm welcome to Shri Pawan Kumar Bansal, Union Minister of State for Finance, Dr. K.C.Chakrabarty, Chairman & Managing Director (Chairperson of the SLBC), Shri Hardeep Kumar, IAS, Spl.Secretary, Finance and Director, IF&CC, Haryana, Shri Roshan Lal, IAS, Spl. Secretary and Director, Rural Development, Haryana, Dr. Amandeep Singh, IRS, OSD to MOS, GOI, Shri Sanjiv Jindal, Dy. Secretary, Ministry of Finance, Government of India, Shri A.Udgata, CGM, RBI, New Delhi, Smt. Kamala Rajan, GM, RBI, Delhi, Shri V.Rama Krishna Rao, CGM NABARD, Shri Surender Kumar, Executive Director, National Housing Bank, Shri V.Murli, GM, SBI, Shri N.Sheshadri, GM, Canara Bank and other dignitaries representing various Banks, Financial Institutions, Government Departments and Media persons. He expressed his gratitude for the continued support extended to Banks by the State Government, RBI & NABARD in meeting various developmental commitments. Shri Gupta also briefed the house about important proceedings of the meeting of Steering Committee to SLBC, Haryana held on 04.03.2008. Shri Gupta expressed his satisfaction over the performance of the Banks especially under National Goals, Financial Inclusion, Agri Credit, Credit Flow to SME Sector, Achievement under ACP and Nayak Committee Recommendations etc. Shri Gupta also requested the Banks to ensure submission of error-free data to SLBC and also to send the same data under various parameters as submitted to RBI and NABARD so as to avoid any inconsistency in data. Shri Gupta expressed his gratitude towards all the banker colleagues and Government Departments for extending full support for smooth conduct of Steering Committee meetings and Special meetings called for improving progress under PMRY. While concluding, Shri Gupta requested Dr. K.C.Chakrabarty, the Chairperson of the meeting to deliver his keynote address.

Dr. K.C.Chakrabarty, Chairman & Managing Director, Punjab National Bank, in his keynote address extended warm welcome to the Chief Guest Shri Pawan Kumar Bansal, Union Minister of State for Finance, Senior Dignitaries on the dais, Senior Officials of various Government Departments, Banks and Media personnel.

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At the very outset Dr. Chakrabarty expressed his satisfaction about achievement under various developmental parameters up to the period ended Dec., 2007. He shared with the house that Lead Bank Scheme is very close to his heart but he pointed out that the banking has still not reached all the people. He put forth that during the last forty years of implementation of Lead Bank Scheme, the scheme has not been reviewed so far. However, it is for the first time that RBI has constituted a committee for the same of which he is also a member. He emphasized that without financial inclusion, inclusive growth is not possible and the main objective of Lead Bank Scheme must be the 100% Financial Inclusion. He appreciated the efforts of the banks operating in Haryana for the work done so far towards attainment of 100% Financial Inclusion. Dr. Chakrabarty also appreciated Shri Bansal for his keen interest in developmental activities of various states as he is attending SLBC meetings of other states also. Before presenting the report card, Dr. Chakrabarty shared with the house the macro level developments, which took place since last SLBC meeting

IMPORTANT DEVELOPMENTS IN MACRO ECONOMIC SCENARIO

RBI has kept Cash Reserve Ratio (7.50% -10.11.07), Bank Rate (6% - 29.4.2003), Reverse Repo Rate (6%-25.7.2006) and Repo Rate (7.75% - 31.3.2007) as unchanged.

RBI has advised continuance of providing production credit by banks up to the principal amount of Rs.3.00 lac @7% and to claim the subvention @2% from RBI (Rs.1600 crore for 2008-09).

The projection of GDP for 2007-08 has been retained at 8.5%.

Dr.Chakrabarty further said that We have also witnessed presentation of Union Budget for 2008-09 by the Hon’ble Union Finance Minister. The important proposals concerning Banks were also mentioned by him:

A Multi Sectoral Development Plan for each of 90 Minority Concentrated districts (Total Rs.3780 crore and for 2008-09 – Rs.540 crore).

256 branches opened up to December, 2007 this year in Minority districts and 288 more be opened by March, 2008.

All women SHGs are to be covered under LIC’s Janashree Bima Yojana.

Agri Credit target for 2008-09 has been fixed at Rs.2,80,000 crore.


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Irrigation and Water Resources Finance Corporation has been proposed. (initial capital of Rs.100 crore).

National Agriculture Insurance Scheme will continue during 2008-09 also. (Rs.644 crore have been proposed).

Agri Debt Waiver:

Agriculture loans by Scheduled Commercial Banks, Regional Rural Banks and Cooperative Banks disbursed up to 31.03.2007 and which have become overdue as on 31.12.2007 but not repaid up to 29.02.2008 are covered in respect of Small & Marginal Farmers with land holding up to two hectares.

For other farmers, an OTS for overdue loans as on 31.12.2007 and remained unpaid up to 29.2.2008 – rebate of 25% is to be given and 75% is to be repaid by the farmers.

Rescheduled/restructured loans are also eligible for waiver/OTS.

The debt waiver exercise is to be completed by 30.06.2008. Thus all banks have to work very hard for the same, Dr.Chakrabarty said.

The farmers covered under Debt Waiver/Relief will be eligible for fresh financing also.

RIDF Trenche XIV – 2008-09 will be provided Rs.14000 crores.

SME Risk Capital Fund in SIDBI : The guarantee fee is to be reduced from 1.5% to 1% and annual service fee from 0.75% to 0.50% for loans up to Rs.5 lac.

Financial Inclusion : Recommendations:

- All Commercial Banks and RRBs are to add at least 250 rural Household accounts every year at each of Rural & Semi Urban branches.

- To allow individuals, such as retired bank officials/Ex-servicemen etc. to be appointed as Business Facilitator/Business Correspondents or Credit Counsellers.

- In fact, the Hon’ble Finance Minister has advised banking fraternity to embrace the concept of total Financial Inclusion, he said.

DRI :

- A revised eligibility criterion has been proposed as suggested by SLBC Forum.

- Annual Family Income of Rs.18000/- (enhanced from Rs.6400/-) for Rural and

- Rs.24000/- (enhanced from Rs.7200/-) in Urban areas .


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Banking Cash Transaction Tax (BCTT) will be withdrawn w.e.f. 01.04.2009. Banker colleagues and bank customers will feel happier, Dr.Chakrabarty said.

He also shared his satisfaction that Haryana’s economy is growing at about 11.2% which is higher than that of the nation. In fact, higher economic growth is the mantra for finishing the poverty and he was happy to share that the State Government is following the same which induces enthusiasm amongst bankers and other partners like NABARD and different Government agencies in economic development.

Action taken on the Action Points of last SLBC held on 17.12.2007

FINANCIAL INCLUSION:

During the 100th SLBC meeting held on 26.05.2007, the house had identified 16 districts for 100% Financial Inclusion. The Convener Bank and Syndicate Bank had further identified Gurgaon and Faridabad districts while LDMs of Sonepat and Sirsa volunteered to cover their districts also under this mission. Thus, no district of the State was left out of this noble mission.

He, however, said that we are not declaring 100% financial inclusion of entire State and advised the banks and LDMs to make another attempt to achieve 100% financial inclusion.

The efforts put in by the banks and Lead District Managers are not being undermined, he said.

Dr.Chakrabarty said that all will agree with him that this was only a beginning, just by opening of accounts does not tantamount to complete Financial Inclusion. Now, we all have to go a step further for providing financial assistance to all the needy people so as to behold a smile on their faces too.

He, therefore, requested the Banks and the Lead Districts Managers to take another three months, give an advertisement in local papers requesting the remaining households to open accounts with the banks. Keep the authentic record regarding 100% Financial Inclusion fully ready for reality check by RBI officials

Establishment of Financial Education and Credit Counselling Centre

The concept of Financial Literacy should be given due cognizance by member banks so that it percolates to the rural areas also. This will definitely narrow the gap created by IT revolution between urban and rural populace. He was happy that Convener Bank has already opened one Financial Education and Credit Counseling Centre at Yamuna Nagar. Today, we have opened one more such centre at Chandigarh which will also cater to the needs of District Panchkula of Haryana. Canara Bank and Syndicate Bank have also established one such Centre each at Naultha in Panipat and Nuh in Mewat District respectively.


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He, however, suggested that performance of these centres be reviewed regularly in SLBC meetings. We should assess its efficacy and share the success of such centre with member banks to popularize this concept in other districts jointly or individually.

Review of Performance of Banks up to December, 2007

He was happy to say that banking system in the State has achieved the National Goals in respect of Priority Sector, Agriculture Credit, CD Ratio and lending to Weaker Sections etc. for the period ended December, 2007.

140 new Branches of Commercial Banks and RRBs have been opened since December, 2006 raising the total number of branches to 1908. He expressed his pleasure to say that no Block of Haryana is unbanked. He suggested that problems in branch expansion, if any, be discussed. The agenda papers should also include the information regarding licenses in hand, progress in opening of rural branches particularly in minority concentrated districts.

Total deposits increased from Rs.52222 crore as at December, 2006 to Rs. 65802 Crore up to December, 2007 showing a growth of 26%, which he rated as satisfactory.

Total Advances during the period December, 06 to December, 07 have increased from Rs.33576 crore to Rs.42586 crore showing a growth of 26.83% which was again satisfactory.

Priority Sector advances have increased from Rs.19915 crore as at December, 06 to Rs.24049 crore as at December, 07 showing a growth of 20.75%.

Agriculture advances have increased from Rs.9676 crore as at December,06 to Rs.12476 crore as at December, 07 recording a growth of 28.93%.

Advances to Micro & Small Enterprises have increased from Rs. 4129crore as at December, 06 to Rs.5388 crore up to December, 07 showing a growth of 30.49% which was quite satisfactory.

Weaker Sector advances have increased from Rs.3034 crore as at December, 06 to Rs. 4192 crore as at December, 07 thereby showing an increase of Rs.1158 crore or 38.16% which he appreciated.

Overall CD Ratio at State level including RIDF comes to 74%. However, he was happy to say that no district of Haryana has CD Ratio below 40% as at December, 2007.

Performance of Banks Under SME : As against annual target of 20%, the Banks have registered a growth of 50.69% which he termed as quite satisfactory. The policy package stipulates Doubling of Credit to SME by 31.03.2010 but it was


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a matter of great satisfaction that Banks in Haryana have already surpassed the target much ahead of the target date. As per the annual target of 5 new units, per semi-urban/ urban branch, the pro-rata target comes to 3.75 Units whereas the Banks in Haryana have added 4.52 units during the period ended December, 2007.

Performance under Annual Credit Plan- 2007-08

He was happy that performance of Banking system under prestigious Annual Credit Plan up to December, 2007 was quite good as the overall achievement was 109%.

Performance of Banks under some important Government Sponsored Schemes

PMRY- 2006-07 : Banks have already achieved 105% of the target though the date was extended to 30.11.2007 for disbursement in milch animal cases.

PMRY- 2007-08: The %age achievement as at Dec., 07 was low at 45.43%. However, latest position up to 13.03.2008 show improvement as the achievement was 77.10% of disbursement vis-à-vis target. Since the financial year has already came to an end and PMRY as well as REGP Scheme are being merged into one scheme i.e. Prime Minister Employment Generation Programme (PMEGP), Banks should complete the disbursements on or before 31.05.2008 and achieve the annual target for the third consecutive year also, the Chairperson said.

Swarna Jayanti Sahari Rojgar Yojana (SJSRY) & Swarnajayanti Gram Swarozgar Yojana (SGSY) : The performance of Banks was satisfactory.

Self Help Groups (SHGs) : 25265 SHGs have been Saving-linked and 14953 credit-linked up to December, 2007. The percentage of Women groups at 68% is commendable. Micro financing has assumed greater importance and the role of banks has become even more demanding. There is a need to have close rapport with NGOs and other agencies including Social Welfare Agencies to help in formation and linkage of SHGs.

RECOVERY UNDER GOVERNMENT SPONSORED SCHEMES:

The recovery position under Government Sponsored Schemes is, however, an area of concern:

PMRY : 49.46%SGSY : 49.38%SJSRY : 53.65%SHG (under SGSY) : 78.72%SHG (other than SGSY) : 77.91%


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He requested all the Sponsoring Agencies/Government Departments to help the banks in improving their recovery position under Government schemes as low recovery has affected the recycling of public funds apart from giving rise to non-performing assets.

Position Regarding Recovery Certificates :

4684 Recovery Certificates amounting to Rs.53.94 crore were pending for disposal. He showed his concern that 1417 cases amounting to Rs.7.85 crore are pending for

more than 3 years. There is an urgent need to get this pendency cleared.

He expressed confidence that Government Departments and LDMs will bring the pendency of Recovery Certificates to almost Nil during current financial year 2008-09.

Focused attention is required as far as lending to Ex-Servicemen, their widows, Women, Scheduled Caste community and minority communities of the State. We have to adopt a coordinated approach to supplement the income generating activities of the unemployed youth. Implementation of employment generation schemes formulated by Central/State Governments can go a long way in meeting their requirements/ objectives.

He called upon the fellow-bankers to rise to the occasion and put in earnest efforts towards the following also:

Popularise KCC Scheme further so that no eligible farmer is left without the card.

Promote Agri Clinics/Agri Business Centres, Horticulture and Venture Capital projects with the help of National Horticulture Board and NABARD. The projects sponsored by Small Farmer Agriculture Business Consortium(SFAC) may be financed on priority as the Government has clearly indicted termination of MoUs signed by the Banks if the performance under the scheme does not improve.

Promote the concept of Farmers’ Clubs and Kissan Goshties with the help of NABARD and utilize their services for extending outreach of banking facilities in hitherto excluded areas of the State ensuring desired financial inclusion.

Help the small borrowers availing credit facilities up to Rs.50,000/- by

dispensing with the practice of calling No Due Certificate; instead Banks may obtain Self Declaration from the borrower.

Due attention be paid towards economic upliftment of Minority Communities in the identified districts of Haryana namely Gurgaon and Sirsa. SLBC Forum should review performance of credit flow to such communities regularly.

The SME cluster concept should also be strengthened.


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NATIONAL AGRICULTURE INSURANCE SCHEME (NAIS) The notification for the current Rabi season has been issued by the Government for which a High Power committee meeting was held on 7.12.2007 during which the Convener Bank has suggested to make the scheme farmer friendly and consider the village/group of villages as a Unit instead of a Block while arriving at the impact of any natural calamity. This would help in enlarging the scope of relief to the affected farmers. Before he concluded, he requested the State Government to resolve certain

long outstanding issues of SLBC so that such items could be dropped instead of carrying it forward over and over again.

While concluding, he assured the State Government and Hon’ble Minister of full cooperation by member banks in discharging their responsibilities towards strengthening and uplifting the socio-economic conditions of the people of the State.Dr.Chakrabarty expressed his gratitude towards the Chief Guest Shri Pawan Kumar Bansal for showing keen interest in the developmental process of the State. It will be an honor and privilege for all of us to listen to his views and suggestions, which would go a long way in promoting various developmental policies of the State. He then requested the Chief Guest Shri Pawan Kumar Bansal, Hon’ble Union Minister of State for Finance to address the House. At the beginning, Shri Bansal expressed his happiness over the performance of the banks during the period under review. He remembered the proceedings of 100th SLBC meeting held on 26.05.2007 during which he advised all the banks to cover atleast 16 Districts of Haryana under 100% Financial Inclusion on or before 31.03.2008. He was happy in saying that the first phase of financial inclusion has been completed by the banks in all the 20 districts of Haryana. Shri Bansal briefly touched upon the following points also :

Gone are the days when a person was approaching the bank for services but it’s a matter of satisfaction that banks are a driving force of India’s story of today’s growth.

The Indian Prime Minister has emphasized that the target is of inclusive growth and 9% growth should not satisfy us all.

The financial exclusion leads to social exclusion, which has to be fought by financial inclusion and inclusive growth.

He said that it is heartening that banks are taking adequate steps in this regard, as the states are being declared one by one having been covered under 100% Financial Inclusion.

He also said that though the first phase is almost over but the people be also provided the facility of some overdraft and training to manage the funds be imparted, which will also help in enhancing the literacy level of the state as the same is also an important tool for inclusive growth.


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While commenting on the performance of banks in Haryana, Shri Bansal said that though there was decline under certain parameters but the growth under deposits, advances, priority sector and agriculture advances is quite good. He also informed the house that despite general decline in agriculture sector in various states, the banks in Haryana have done well. However, he called upon the banks to improve the performance under priority sector advances as the share has come down from 63% to 56% as at 31.12.2007. The growth under agriculture sector should also be stepped up in view of the annual target fixed by the Govt. of India at Rs.280000 crore for 2008-09. He, however, expressed his happiness over CD Ratio at 74% but called upon the 9 banks whose CD Ratio was below 40%. He also advised the Convener Bank to review the performance of Agri clinics in the next SLBC meeting.

While commenting on SHGs, Shri Bansal quoted an example of a poor women, to whom a bank sanctioned a loan of Rs.60000/- by swapping her loan from moneylender, which helped her coming out from the clutches of the informal credit sources which are charging high rate of interest.

While concluding, Shri Bansal expressed his gratitude to the Convener Bank for inviting him to the meeting as Chief Guest and wished a success for SLBC forum, Haryana.

Shri A.Udgata, CGM, RBI, New Delhi, while addressing the house called the day as a special occasion when a Financial Education and Credit Counseling Centre has been inaugurated in the morning by the Hon’ble Union Minister of State for Finance and Dr. K.C.Chakrabarty, CMD of Punjab National Bank. He called the day as special also as the pilot project of bio-metric smart cards was being launched by PNB at Mauli Jagran, Manimajra, U.T.Chandigarh. Shri Udgata also touched upon the following important points :-

He appreciated the efforts of the Convener Bank and other member banks for initiating adequate steps both for financial inclusion and financial literacy.

Even after 40 years of operation of Lead Bank Scheme, still the fruit of development and growth could not reach many people, Shri Udgata said.

He emphasized on improvement in credit delivery system.

He also advocated that out of box thinking is required for giving impetus to the drive of financial inclusion and financial literacy.

He said that RBI has given very useful idea of appointing Business Facilitators/correspondents but the same is not happening in Haryana as in Dharavi, a success story. RBI has prepared simple booklets on financial inclusion and also arranged essay competitions for students in various schools, Shri Udgata said.


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While concluding Shri Udgata called upon all the bankers to sanction collateral free loans as per guidelines and the progress in this regard should also be reviewed in such like important meetings.Shri V. Ramakrishna Rao, CGM, NABARD in his brief address informed the house about the prestigious State Credit Seminar during which the State Focus Paper for 2008-09 was presented. He said that 16% growth of credit has been projected for the State of Haryana and it has been emphasized in the Focus Paper that targets for physical numbers/borrowers should also be achieved.

Shri Rao shared his concern with the house that the progress under credit flow to horticulture sector is not picking up in the State of Haryana. He also informed the house that success stories on account of Agri Clinics and SHGs etc. are being compiled by NABARD. He briefed the house about the farmers’ clubs established by various banks and being nurtured by NABARD. The progress under financial inclusion shall also be monitored by NABARD as per budget proposals, Shri Rao expressed.

While concluding Shri Rao informed the house that the recommendations of Vaidyanathan Committee for revival of Cooperative Sector in the State of Haryana are being implemented successfully.

Shri S.K.Singla, Chief Manager took up the agenda items with the permission of the Chair as under:1. CONFIRMATION OF MINUTES OF 102 ND MEETING OF SLBC

HARYANA

The minutes of the 102nd meeting of the State Level Bankers’ Committee, Haryana, held on 17.12.2007 were sent vide Convener Bank’s letter dated 14.01.2008. As no observation was received, the house confirmed the minutes.

2. PENDING ISSUES WITH THE STATE GOVERNMENT

Revenue Department i) Raising of Exemption Limit on Stamp Duty in Agriculture

AdvancesWhile deliberating on the issue, Shri Hardeep Kumar, IAS, Special Secretary Finance and Director, IF&CC, Haryana informed that the Government has already declined to raise the exemption limit as maximum tractor loans/other loans are covered within the exemption limit. Dr.K.C.Chakrabarty, Chairperson intervening the discussions put an interrogation on the demand of banks for raising the exemption limit and suggested that if the Government is not agreeing to the demand, the issue may be dropped. The stamp duty as fixed by State Government has to be paid, Dr.Chakrabarty said. Though the issue has been treated as dropped, yet any member bank can send its views to Convener Bank on priority.


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ACTION : ALL BANKS

ii) Noting of charge on Agriculture land as per HACOMP Act Section 4 & 6.The issue was deliberated at length and Shri Hardeep Kumar suggested that since banks’ charge is being noted and instructions have been issued to Revenue Department, the issue may be dropped. Shri Pawan Kumar, Bansal, Hon’ble Union Minister of State for Finance, also put forth that banks may not pursue the matter further and recovery of banks’ dues be considered as a main concern. However, he requested State Government representative to help the banks in improving the recovery position. The Chairperson of the meeting Dr.K.C.Chakrabarty also agreed and requested the State Government to support the banks for recovery of banks’ dues.

The issue has been treated as dropped.

iii) Noting of Bank’s charge on the basis of equitable mortgage by way of deposit of title deeds.

This issue was also deliberated in detail and intervening the discussions, Dr.K.C.Chakrabarty informed the house that one property is being mortgaged to more than one Financial Institution. Thus the State Government was requested to note bank’s charge in revenue record on the basis of equitable mortgage without charging any fee as per the decision of Hon’ble Punjab & Haryana High Court.Shri Hardeep Kumar, IAS informed the house that land record is being computerized and there will be no problem in checking the record by the banks and farmers will not be required to visit the Patwari for the same. However, Dr.K.C.Chakrabarty said that computerization of land record will only help the banks when the charge is noted in the revenue record. Dr.K.C.Chakrabarty insisted that banks’ charge must be noted and the State Government should find out some amicable way to solve this long outstanding issue.

ACTION : REVENUE DEPARTMENT

Industries Department iv) Proposed amendments in Haryana Public Moneys (Recovery of Dues) Act

While deliberating on the issue of proposed amendments in Haryana Public Moneys (Recovery of Dues) Act, Shri Hardeep Kumar , IAS, DIF, Haryana informed the house that the State Government has already rejected to carry out the proposed amendments in the Act. However, keeping in view the fact that some other States have already carried out similar amendments, the Chairperson advised that the issue may be discussed in Steering Committee meeting to find out some solution.

ACTION : CONVENER BANK/INDUSTRIES DEPARTMENT


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Agriculture Department

v) Amendment in Haryana Agriculture Credit Operations and Miscellaneous Provisions (HACOMP Act)

The proposed amendments were put up before the house for discussion. The representative of Agriculture Department Shri Dharam Pal, DDA informed the house that only two issues are being pursued by Agriculture Department with the State Government. However, Shri R.K.Gupta, GM, PNB clearly informed that all the issues mentioned in the Agenda papers are regularly pursued with the Agriculture Department but the same are pending since long.Dr.Chakrabarty intervening the discussion advised that the issues of Agriculture Department may be sorted out in the Steering Committee meeting and outcome be reported in the next SLBC meeting.

Dr.Chakrabarty also said that Haryana State is a Model State and it is expected that all such issues are sorted out amicably at an early date.ACTION ; AGRI DEPTT./CONVENER BANK

3. 100% FINANCIAL INCLUSION The house was informed that all the 20 districts of Haryana State (Rural area) have been covered under 100% Financial Inclusion. Shri Pawan Kumar Bansal, Chief Guest of the meeting appreciated the efforts put in by banks and LDMs in this regard. However, the Chairperson Dr.K.C.Chakrabarty suggested as under:

100% Financial Inclusion of entire State can not be declared as yet. He said that by opening 3 lac No Frills Accounts in the State, Financial Inclusion can not be treated as complete. He advised the banks to go in for one more drive because Reserve Bank of India is going for a survey for reality check and in such cases, there should be no difference in data of 100% Financial Inclusion.

He advised the Lead District Managers and banks to re-examine the position, give an advertisement in the newspaper requesting people for opening of accounts, if they don’t have.

He suggested that during summer vacations, students of various schools/colleges be engaged for opening of accounts by paying some incentive say Rs.5/- or so for each account and individual bank may decide the incentive according to their position.

He expressed that he is not undermining the efforts put in by LDMs and Banks and appreciated the work done so far.

He suggested that the matter of Financial Inclusion be discussed in detail in DLRC meetings and district administration (DC/ADC) may also agree about the 100% financial inclusion of the district.


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Pucca record of financial inclusion be maintained by each bank and LDM which is to be shown to the RBI officials as & when required.

He also advised LDMs and banks to maintain village wise record also.

Dr.Chakrabarty also said that the entire exercise must be got completed within maximum period of three months. Shri Hardeep Kumar, IAS also participated in the deliberations on financial inclusion and informed the house that Haryana State Government is going to disburse pensions to Senior Citizens and other allowances to Weaker Sections through banks. This will also help in completion of the task of financial inclusion. Shri Pawan Kumar Bansal suggested that data regarding households be also taken from census so as to maintain consistency in the record.ACTION : ALL BANKS & LDMs

3.1 GRANT OF AB INITIO OVERDRAFT FACILITY OF Rs.500/- TO THE HOLDERS OF NO FRILLS ACCOUNTS

The Convener Bank has suggested that all banks may consider granting of Overdraft facility say up to Rs.500/- in No Frill Accounts so as to ensure total financial inclusion. The Chairman of the meeting also supported and advised all the Banks to consider granting of Overdraft facility, may be initially for Rs.100 or Rs.200/- which will help the poor people incase of emergency. The General Manager of State Bank of India, Shri V.Murli, expressed that his bank will also like to participate in this mission. However, for granting of overdraft facility, the proposal has to be sent to Central Office of State Bank of India for approval. All the Banks were also requested to obtain the sanction from their Corporate Offices and to submit the progress in this regard to Convener SLBC for review in the next meeting.ACTION : ALL BANKS

3.2 BUSINESS FACILITATORS AND BUSINESS CORRESPONDENT MODELS

All the Banks were advised to implement the RBI’s guidelines and send Districtwise progress report to Convener SLBC for review in the next meeting. The Chairperson of the meeting suggested that each bank must collect the proper data regarding transactions which are taking place with the help of BF/BCs.ACTION ; ALL BANKS/CONVENER BANK

3.3 ESTABLISHMENT OF FINANCIAL EDUCATION AND CREDIT COUNSELING CENTRE (FECC)

The house was informed that three Financial Literacy and Credit Counselling Centres have already been established i.e.at Yamuna Nagar by PNB, at Naultha in Panipat district by Canara Bank and at Nuh in Mewat District by Syndicate Bank and one more Centre at Chandigarh by PNB which will also cater to the needs of District Panchkula of Haryana. The house also approved the proposal for opening of such Centre in Ambala


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by State Bank of India, Sonepat by SBOP, Karnal by OBC, Sirsa by Central Bank of India and Rohtak by PNB. All the concerned banks were requested to initiate appropriate steps for early establishment of such centres.

Chairperson of the Committee also advised that the concerned banks should also submit complete data/progress report regarding functioning of these centres so that the same may be reviewed in the SLBC meetings. The Incumbent of such centres should also meet at least on quarterly basis for sharing the experiences and to plan future strategies for making the concept of opening of such Centres a success.

ACTION : ALL CONCERNED BANKS

4.1 BASIC STATISTICAL DATA

4.2 OPENING OF NEW BRANCHES BY COMMERCIAL BANKS/RRBs

The house was informed that 140 branches have been opened since December, 2006 in the State of Haryana. However, Dr.K.C.Chakrabarty suggested that banks should inform about the problems, if any, in branch expansion. He also suggested that opening of new branches in rural areas as well as in identified Minority Community districts should be reviewed in the SLBC meeting.

ACTION : BANKS/CONVENER BANK

4.3 to 4.8 : BASIC STATISTICS (DEPOSITS, ADVANCES, PS ADVANCES, AGRI ADVANCES, MSE AND WEAKER SECTOR ADVANCES

The house expressed satisfaction over good performance of banks under Deposits, Advances, Priority Sector Advances, Agriculture Advances, Advances to Micro & Small Enterprises and Advances to Weaker Section. However, under PS Advances, Shri Pawan Kumar Bansal advised all the Banks to improve the share out of Total Advances.

ACTION : ALL BANKS

5. ACHIEVEMENT UNDER NATIONAL GOALS

The house expressed satisfaction over the achievement of national goals by all the Banks in Haryana except advances under DRI. However, it was expected that DRI Advances will further improve with the revision of income eligibility criteria in the budget proposals of 2008-09.

Shri Hardeep Kumar suggested that reasons of low CD Ratio in respect of certain districts be also ascertained and balanced development may be ensured by the bank (Districts are Rewari, Gurgaon, Jhajjar, Rohtak, Sonepat & Panchkula).

ACTION : BANKS/LDMs


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6.3 FINANCING OF AGRI CLINICS

The house was informed that the banks in Haryana have already achieved the target of ten Agri Clinics per district as reviewed in the 100th SLBC meeting. However, Mr.Bansal desired that the progress report regarding functioning of such Agri Clinics be obtained from the concerned banks and be reviewed in SLBC meetings regularly.

ACTION : CONCERNED BANKS

6.4. FARMERS’ CLUBS

The house was informed that the banks in Haryana have formed 1218 Farmers’ Clubs as at 31.12.2007. CGM, NABARD, Shri V.RamaKrishna Rao and GM, NABARD Dr.D.C.Sharma actively participated in the discussions regarding formation and nurturing of Farmers’ Clubs by the Banks/NABARD. They informed the house that the formation part of Farmers’ Clubs is quite OK in Haryana but good number of them are inactive. The Chairperson, Dr.Chakrabarty suggested that the Debt Waiver Scheme for Agri. Credit be discussed in the meetings of Farmers’ Clubs and number of meetings conducted by such Clubs be also reviewed regularly. Dr.D.C.Sharma further informed that the performance of Clubs is being reviewed regularly and on the basis of rating of Clubs, the awards are also being given to the Best performing Clubs. CGM, NABARD, Shri Rao advised the banks to improve the quality of the Clubs.Shri Hardeep Kumar intervening the discussions suggested that experts from Agriculture Department should interact with the Farmers’ Clubs regularly and awareness about the latest Farm Technology be created amongst the farmers.

ACTION : ALL BANKS/AGRI DEPTT/NABARD

6.5 SCHEME FOR FINANCING AGRI BUSINESS PROJECTS WITH VENTURE CAPITAL ASSISTANCE FROM SMALL FARMERS AGRI BUSINESS CONSORTIUM (SFAC)

The house was informed about the MoU signed by the Banks with SFAC and that the same is likely to be terminated by the Government of India if the banks failed to perform well. However, it was pointed out by the member banks that no representative from SFAC is attending the meeting, no project has been sponsored to any Bank and also that there is no independent office of SFAC for the State of Haryana. It was, however, resolved that the position may be informed to SFAC by Convener Bank.

ACTION :CONVENER BANK


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6.6. NATIONAL HORTICULTURE MISSION/ NATIONAL HORTICULTUREBOARD

It was informed to the house that the credit to Horticulture projects is not picking up in Haryana as the meetings for LOIs are not being conducted regularly. The Asstt. Director, National Horticulture Board, Shri S.K.Singh was requested to conduct the meeting sregularly and to send the LOIs to various banks for financing. He was also requested to inform the Bankwise pendency, if any to the Convener Bank so that the matter may be followed up suitably.

ACTION : NATIONAL HORTICULTURE BOARD

7. PERFORMANCE UNDER ANNUAL CREDIT PLAN- 2007-08The house expressed its satisfaction over 109% achievement under ACP 2007-08 up to December, 2007. However, the house deliberated on low performance under ACP by Cooperative Banks (76%). The CMD of HARCO Bank informed the house that the Cooperative Banks will do better during the current financial year and they will achieve the targets also.

ACTION : COOPERATIVE BANKS

8. REVIEW OF PERFORMANCE UNDER GOVERNMENT SPONSORED SCHEMES

8.1 SWARAN JAYANTI GRAM SWA-ROZGAR YOJANA (SGSY)

The house expressed its satisfaction over the performance under SGSY. However, Shri Roshan Lal, IAS, Rural Development advised the banks to sanction adequate credit under the scheme so that per capita fund flow is raised further.

ACTION : BANKS

8.2 SELF HELP GROUPS

The position of Self Help Groups as at December 2007-08 was placed before the house and achievement was rated as satisfactory. However, Shri Bansal and the Chairperson Dr. Chakrabarty advised all the banks as under:

Number of SHGs is still less as compared to performance of other States. More SHGs of Tenant/lessee farmers be formed to improve their economic

condition. Capacity building of the SHGs be also enhanced collectively by all the agencies

involved.

ACTION: RURAL DEVELOPMENT DEPTT./BANKS


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8.3 CENTRAL LEVEL COORDINATION COMMITTEE– SGSY

The house was informed about 11th meeting of CLCC held on 8.2.2008 under the Chairmanship of Union Minister of Rural Development, Government of India at New Delhi. The major points emerged during the said meeting were shared with the members. The house was informed that there is no unbanked Block in the State of Haryana. The member banks were also advised that there should be no branch with 0% to below 25% lending under SGSY. The banks were also advised not to charge interest on subsidy portion of the scheme.

ACTION : ALL BANKS

8.4 PRIME MINISTER ROZGAR YOJANA 2006-07

The house appreciated 105% achievement by Banks under PMRY 2006-07. The scheme has already been closed on 30.11.2007.

8.4.1 PMRY 2007-08The progress of banks was placed before the house and same was not treated as satisfactory up to 31.12.2007. However, Shri R.K.Sharma, Joint Director, Industries informed the house that 90% of the target has been achieved up to 31.3.2008 and that the date for disbursement has been extended by Government of India up to 31.5.2008. All the banks were advised to achieve the target before the said date. Intervening the discussion, Dr.Chakrabarty advised that viable activities be brought under PMRY, the beneficiaries under PMRY be covered under CGFMSE and efforts be made to bring people above the poverty line. Some of the member banks pointed out that large number of applicants being sponsored by DIC do not satisfy eligibility criteria hence the same are rejected. Shri Sharma, replying to the query of banks suggested that banks may sponsor applicants on their own. The member banks also suggested that the Government should help the banks in improving the recovery position under Government Sponsored Schemes which was supported by Dr.K.C.Chakrabarty, Chairman of the Forum.

ACTION : BANKS/INDUSTRIES DEPTT.

PRIME MINISTER EMPLOYMENT GENERATION PROGRAMME

The house was informed that PMRY and REGP schemes are being merged by Government w.e.f. Ist April, 2008. However, modalities of the new scheme are yet to be informed by the Government.

8.5 SWARAN JAYANTI SHAHARI ROZGAR YOJNA (SJSRY)

The house expressed its satisfaction over the performance of the banks under SJSRY up to 31.12.2007 but banks were advised to achieve the annual target.

ACTION : BANKS


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9. HOUSING FINANCE

The data regarding Housing Finance extended by the banks was placed before the house showing year on year growth as 6.90%. The Minister of State for Finance Shri Pawan Kumar Bansal pointed out that credit flow to housing projects below Rs.50,000/- should further improve.

ACTION : ALL BANKS

9.1 GOLDEN JUBILEE RURAL HOUSING FINANCE SCHEME OF NATIONAL HOUSING BANK

While deliberating on the performance under Golden Jubilee Rural Housing Finance, Shri Surender Kumar, Executive Director. NHB pointed out that the progress is not picking up due to problem of availability of clear title in Lal Dora areas and also the stamp duty on such advances.The representative of SBOP Shri BBL Joshi informed the house that Rural Housing is not picking up as the same is not possible in Lal Dora area. However, if the State Government help the banks in creating charge on the land falling under Lal Dora on the basis of certificate furnished by the Gram Panchayat/Sarpanch/Member Panchayat etc., the financing under Housing Scheme in rural areas may pick up. Shri Bansal intervening the discussion suggested that the State Government should issue such instructions in this regard. It was also suggested that a sub committee may be constituted to sort out the issues relating to financing under Rural Housing in Lal Dora areas. A representative from National Housing Bank should also be nominated as a member of such sub committee.

ACTION: REVENUE DEPTT./CONVENER BANK10. SWAROZGAR CREDIT CARD SCHEME (SCC)The progress under Swarozgar Credit Card was placed before the house but the same was not rated as satisfactory (59.66%). However, the Chairperson asked Regional Rural Banks and Cooperative Banks to inform the latest position under the scheme and RRBs and Cooperative Banks informed the house that they have achieved the targets. It was requested that the latest position be sent to Convener Bank for next SLBC purpose.

ACTION: ALL BANKS/COPERATIVE BANKS/RRBs

11. PROGRESS IN IMPLEMENTATION OF POLICY PACKAGE FOR STEPPING UP CREDIT TO SMALL & MEDIUM ENTERPRISES (SMEs)

11.1, 11.3 & 11.4 DOUBLING OF CREDIT IN FIVE YEARS

The house was informed that the banks in Haryana have already achieved the doubling of credit to SME Sector before the target date i.e. 31.3.2010. The house appreciated the banks on this achievement


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The progress regarding opening of at least one Specialised SSI/SME branch in each district was reviewed with satisfaction. However, it was decided by the house that remaining nine districts be also covered under the programme. The house approved that Canara Bank will open such branch in Sirsa. PNB, in Kaithal & Rewari, SBI in Jind & Faridabad, Syndicate Bank in Mewat and Mahindergarh districts. SBI further informed the house that such branch is already functioning in Hisar and they will also open one such branch in District Rohtak. The concerned banks were requested to initiate necessary steps and send progress to Convener Bank for review in the next SLBC meeting.

ACTION: ALL CONCERNED BANKS

11.2 EXTENDING FORMAL CREDIT TO NEW UNITS

It was observed that 1174 Semi urban and urban branches of commercial banks and RRBs in Haryana provided finance to 5739 new SME units during the first nine months i.e. up to December, 2007. The average per SU/U branch was 4.88 against the proportionate target of 3.75 units. The achievement was termed as quite satisfactory.

11.5 FLOW OF INSTITUTIONAL CREDIT TO SSI CLUSTERS

The progress under Flow of Institutional Credit to SSI Clusters was placed before the house and the same was rated as satisfactory. Out of 4 identified clusters, three clusters had already surpassed their annual target up to December, 2007. The Chairperson asked the Convener Bank to incorporate number of units financed along with the amount in the agenda and background papers of forthcoming SLBC meeting.

11.6 SMALL ENTERPRISES FINANCIAL CENTRES (SEFCs)

The house was informed that no progress has been informed by SIDBI during the period 1.4.2007 to 31.12.2007. Keeping in view Nil performance, the house was requested to drop the item, but Smt. Kamala Rajan, GM, RBI, New Delhi suggested that the item should be continued further and SIDBI was requested to inform the progress to SLBC Convener.

ACTION: SIDBI

11.7 to 13 CREDIT GUARANTEE SCHEME OF CGMSE/REGP/NAYAK COMMITTEE NORMS/SICK SMEs

The house also expressed its happiness over good performance of banks under CGFMSE, REGP, Nayak Committee recommendations and revival of Sick SMEs etc.

ACTION: BANKS


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14.1 OUTSTANDING CASES UNDER HACOMP ACTThe house was informed that 4684 cases involving an amount of Rs.53.94 crore was outstanding as on 31.12.2007. Dr.Chakrabarty, Chairperson of the meeting expressed concern about 1417 cases pending for more than three years and requested the State Government representative to help the banks in disbursal of such cases.

ACTION : REVENUE DEPARTMENT/BANKS/LDMs

14.2 RECOVERY UNDER GOVERNMENT SPONSORED SCHEMES

The recovery position under PMRY (49.46%), SJSRY (53.65%) & SGSY (49.38%) was placed before the house and all the member banks requested the State Government to help in improving the recovery position. The Chairman of the Forum said that if the sponsoring agency identify correct beneficiary, there will be no problem of recovery.

The representative of SBOP Shri Joshi informed the Senior dignitaries on Dais that the State Recovery Act is not effective at all in the State of Haryana. He also informed that in case of misappropriation/misutilisation of banks’ funds, FIRs are not being lodged by the Police Authorities. Dr.K.C.Chakrabarty reacting to the same suggested that banks should inform such cases (non lodgement of FIR) to the SLBC Forum and Institutional Finance & Credit Control, Haryana so that amicable solution may be explored. Shri Bansal also intervened the discussion and suggested that the Controlling Heads of the banks should delegate adequate powers to their Branch Managers so that maximum cases may be settled during Lok Adalats.

ACTION : BANKS/REVENUE DEPTT.

15. ADVANCES TO MINORITY COMMUNITIES

The progress of banks under credit flow to Minority Communities in general and in identified districts of Sirsa and Gurgaon in particular was rated as satisfactory by the house, however, banks were advised to improve the performance further.

ACTION : ALL BANKS

16. FINANCIAL ASSISTANCE TO WOMEN BENEFICIARIES

It was observed that Public Sector Banks, Private Sector Banks and RRBs had achieved the goal of 5% whereas the position of Cooperative Banks was below the target. However, overall achievement for the State as a whole was 5% which is as per National Goal.

ACTION : BANKS


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17. ENHANCING THE CREDIT FLOW TO SC/ST BY COMMERCIAL BANKS

Under SGSY Scheme, SC beneficiaries constituted 46.45% of the total disbursement against prescribed norm of 50%. Under PMRY, the cases disbursed to SC beneficiaries were only 12.12% against the norm of 22.5%. In case of SJSRY scheme, 27.94% cases were disbursed to SC beneficiaries against the State norm of 20%.

The concerned agencies were requested to ensure sponsoring of sufficient number of cases for SC/ST beneficiaries under all Government Sponsored Schemes so that the banks could sanction/disburse requisite number of cases.

ACTION : SPONSORING AGENCIES/BANKS

18. APPOINTMENT OF INDEPENDENT DCOs BY BANKS

It was informed that there is no independent DCO of SBI in district Sirsa and Faridabad and OBC in Jind. The representative of SBI informed that the needful has already been done in respect of Sirsa and Faridabad districts. The representative of OBC was requested to appoint independent DCO in Jind district.

Intervening the discussion, Smt.Kamala Rajan, GM, RBI pointed out that DCOs are not attending the DLRC meetings which was not appreciable.

ACTION : BANKS

19. GENERAL PURPOSE CREDIT CARD SCHEME (GCC)

It was informed to the house that 5633 GCCs involving an amount of Rs.1405.85 lac have been issued up to 31.12.2007. The cumulative position since inception is 16626 cards amounting to Rs.3810.77 lac. The banks were advised to use this important tool for achieving total financial inclusion in the State.

ACTION: ALL BANKS

20 ONE TIME SETTLEMENT SCHEME FOR SMALL BORROWAL ACCOUNTS -GOVERNMENT SPONSORED SCHEMES (Scheme approved by SLBC, Haryana)

Out of total 28830 accounts eligible under the scheme, 7030 accounts have been settled up to 31.12.2007. Shri Pawan Kumar Bansal advised that the banks should make more efforts for clearing the backlog.

ACTION : BANKS


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21. NATIONAL AGRICULTURE INSURANCE SCHEME (NAIS)

While reviewing the performance under NAIS, the house observed that the performance is not picking up. All the banks were advised to cover all the loanee farmers as per directives of Government of India. The CMD, PNB also suggested that the farmers may be educated to ensure 100% coverage under the scheme.

ACTION: ALL BANKS/NAIS

22. CLASSIFICATION OF AGRICULTURE LOANS AS NPA

As desired by Reserve Bank of India, Convener Bank placed the modalities for identifying Agriculture loans as NPA. Different dates have been calculated and given in the agenda papers in the form of table. The house approved the same and advised all the banks to follow the same criteria to maintain uniformity in the State of Haryana.

ACTION: ALL BANKS

23. PROPOSED SCHEME OF PROVIDING CREDIT TO SHGs FOR DEBT SWAPPING OF MONEY LENDERS AND AMENDMENT IN EXISTING SCHEME

The house was informed that the Convener Bank is proposing certain amendments in the existing SHG scheme and also to float a new scheme for providing credit to SHGs for debt swapping of Private Money Lenders. As per the proposed amendment in existing scheme, credit is to be provided as first doze after six months of savings @1:4 or Rs.50,000/- whichever is high.

Under the new scheme, it is proposed that credit may be provided to SHGs only and not the individual members for debt swapping of money lenders, as a one time measures only.

After deliberating on the issue, the amendment in the existing scheme for providing first doze of credit after six months of savings @1:4 or Rs.50,000/- was accepted by the house. However, the house did not accept the new scheme for debt swapping of money lenders suggesting that scope of the new scheme may be widened to cover the individual member of the SHGs also instead of group as a whole. The Convener Bank was advised to re-examine the proposed new scheme.

ACTION : BANKS/CONVENER BANK


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24 to 31. Agenda items put up for information of the house.

The progress in respect of following parameters were also presented in the agenda papers for information of the house:

Restructuring/Reschedulement of loans to farmers in distress and in arrears. Special One Time Settlement Scheme for Small & Marginal Farmers. Advances granted to farmers against their indebtedness to informal sector. Self Help Groups formed for tenant farmers and oral lessees. Progress under Kissan Credit Cards. Scheme for Financing farmers for purchase of land for agriculture purposes. Progress under Education Loan Scheme. Artisans Credit Card Scheme. Progress of cases filed under Lok Adalats. Credit facilities to Ex-servicemen and widows of Ex-servicemen Loans granted to disabled persons.

The house expressed its satisfaction over progress made under above parameters also.

VOTE OF THANKS

Shri N.Sheshadari, General Manager, Canara Bank while proposing the Vote of Thanks said that the participants have been enriched by the Key Note Address of the Chairperson and thought provoking speech of Shri Bansal who has been attending SLBCs of various States which has further enriched the level of discussions. More importantly as a Minister of State for Finance, he has given very clear directions to the participants when he said that poorest of the poor are indeed bankable. CMD, PNB has conveyed what is the objective of Financial Inclusion. He has given directions to Banks like a good judge as to how the Lead Bank officials and Branch Managers should really function and do their job actively. He has come out with a clear view point which took the discussion level to a great height. CGM, RBI Shri A. Udgata shared key areas of concern of Financial Inclusion. CGM, NABARD has given very clear insight into role of NABARD as Development Institution, the leading agency. We have got good response from State Government also. Shri Sheshadari expressed gratitude towards all other Senior Dignitaries on the dais, representatives from Government Departments, colleagues from banking fraternity, Lead District Managers and representatives from Print and visual media for making the meeting a grand success.

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