Breaking away from the normal practice of meeting PSU bank chiefs in Delhi, Finance Minister Pranab Mukherjee will hold deliberations with them in Patna tomorrow on the prevailing tight liquidity condition, financial inclusion and farm credit.

Besides the bank chiefs, the meeting would also be attended by the Chief Ministers of all Eastern and Northeastern States.

The meeting assumes importance as it is being held in the light of the prevailing tight liquidity situation in the country. It will discuss the progress of Centrally-sponsored schemes, State-wise flow of credit to the agriculture sector, credit-deposit ratio and loan to weaker section of society among others.

According to the bankers, liquidity condition expected to in remain tight during the month due to the huge 3G and broadband wireless access spectrum charges to the government by telcos besides the first quarter advance tax payment.

This is the first time that such a meeting is being attended by the Chief Ministers whose feedback and suggestions would be considered for widening the reach of banking system in these States so that they can catch up with rest of the nation. Out of the total 129 unbanked blocks in the country, about 70 per cent are in the Northeastern States.

It has been decided to provide appropriate banking facilities to habitations having population in excess of 2,000 by March 2012, Mr. Mukherjee had said in the 2011 Budget speech.

“It is also proposed to extend insurance and other services to the targeted beneficiaries. These services will be provided using the business correspondent and other models with appropriate technology back-up. By this arrangement, it is proposed to cover 60,000 habitations,” he had said.

Besides Bihar, West Bengal and Assam, the Chief Ministers of Orissa, Sikkim, Assam, Nagaland, Tripura, Meghalaya, Manipur, Arunachal Pradesh and Mizoram would also attend the meeting. A representative of Jharkhand is also likely to attend the meeting.

Even heads of public sector financial institutions like the Nabard, Sidbi, IIFCL and Exim Bank would also be part of the meeting.

This is the first meeting after banks announced their annual results for 2009-10. Mr. Mukherjee will take stock of the financial performance of the banks. It would also dwell upon credit flow to the productive sectors, official sources said.

The broad agenda of the meeting include review of credit growth and agriculture credit, infrastructure lending and banks network in unbanked blocks, sources said.

Among others, capital adequacy over medium-term and housing and education loans would also be taken up in the meeting, sources said.

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