The Hindu : Front Page : Bank lending up as Erode thrives

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Wednesday, Jan 23, 2008
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Bank lending up as Erode thrives

Karthik Madhavan

ERODE: The economy of Erode has done well, bettering the record over the previous financial year. As of September 2007, farmers, businessmen, traders and others have availed loans totalling around Rs. 5,765 crore, which is Rs. 1,000 crore more than the corresponding period last year. Bank deposits have grown too: to Rs. 4,840 crore, which is Rs. 581 crore more than last year.

Consequently, the credit-deposit ratio (CDR) has gone up by 7 per cent to reach 119 per cent. According to bankers, a major portion of the advances (Rs. 548 crore) has been to other priority sectors, business, trade, and so on, followed by agriculture (Rs. 242 crore) and small-scale industries (Rs. 115 crore).

The increased lending, the bankers say, comes from the growth in the district’s economy. “Increased lending means the public’s credit absorption capacity has gone up. And that credit is to increase agricultural and industrial activity — signs of a prospering economy,” says J. Vanangamudi, lead bank manager, Canara Bank.

On another count too, the district has put up a good show. “In Erode, 59 per cent of the total advances is for the priority sectors, which is above the RBI-fixed norm of 40 per cent.”

On the self-employment front too the district has done well. “Under the Pradhan Mantri Rozgar Yojna (PMRY), 1,487 beneficiaries have obtained loans, which is more than the RBI target of 1,485 beneficiaries by December 31, 2007.”

Keeping in mind the increased credit and deposit, the National Bank for Agriculture and Rural Development (NABARD) has drafted a potential-linked plan for Rs. 2,446 crore for the coming financial year. This growth has put the district in the first place in the State.

“Erode’s Gross Domestic Product (GDP) at 15.5 per cent was the first in the State and ahead of the State’s [GDP] by 4 per cent,” Collector T. Udhayachandran said recently.

In another pointer to the booming economy, an Erode chapter of the Confederation of Indian Industry has been opened. This spells recognition for the growing role of entrepreneurs from the small towns.

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