MADURAI, Oct 8 (PTI): Finance Minister P Chidambaram yesterday said the nationalised banks have played a key role in helping the United Progressive Alliance (UPA) government achieve 9 per cent growth in the last fiscal.
Those blaming the nationalised banks for doing very little towards economic growth should be ready for a debate, he added.
Inaugurating the Eriyur branch of the State Bank of India Sunday, he said loans to various sectors, including agriculture and education under different interest rates, Self Help Groups (SHGs) and to small industries, housing and other sectors had multiplied in the last several years.
For example, when the UPA government assumed office, the agriculture sector had received Rs 830 billion as loan, which had touched 2050 billion in the last three years. The number of students who had availed education loans had gone up from 400,000 to 1 million and they had received Rs 140 billion. The quantum of housing loan also had gone up several times.
Chidambaram said the banking sector should lend more for further economic development and to sustain the 9 per cent economic growth. That was why the government had decided to open more rural bank branches and focus on concepts like Mutual funds in these areas, he said.
Chidambaram urged people not to hesitate taking loans as even rich industrialists and businessmen were doing so. Banks, he said, should give loans to all genuine applicants.
"If any application is rejected, the bank manager should give in writing the reason for rejecting the loans," he said.
Banks also should go for large-scale lending to the masses for more development.
After banks were nationalised during the period of former Prime Minister Indira Gandhi, people had started seeking loans. The fear about banks in the mind of the common man had been eliminated, he said, adding that banks would continue to serve them and the poor.
"It is the right of the people to seek loans and the duty of the banks to give loans," he said.
Entry of private players had led to stiff competition among nationalised banks and between nationalised and private banks.
Likewise, when the private sector was allowed in telecommunications, sales of cell phones had touched 150 million, he said, adding that both these sectors would register growth only with competition.
Nationalised banks in the country were stronger than some banks even in the UK, the USA and Germany, he added.
'Nationalised banks help Indian govt achieve 9pc GDP'
FE Team | Published: October 09, 2007 00:00:00 | Updated: February 01, 2018 00:00:00
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