Cong to petition RBI, NABARD

Proposal to form Kerala Cooperative Bank

The Congress has once against reiterated its opposition to the State government’s moves to dismantle the cooperative banking sector by promoting the formation of Kerala Cooperative Bank to further the ruling party’s narrow political interests.

The Congress Sahakarna Janathipathiya Vedi, which has been in the forefront of the opposition to the setting up of the new bank, said that it would petition the Reserve Bank of India (RBI) and NABARD not to give sanction to the proposed bank.

Leader of the Opposition Ramesh Chennithala, in a statement here on Thursday, wanted the State government to drop its decision. The dismantling of cooperative banks would terminate the democratic character of the sector. It would also set the State for mismanaging their valuable assets and deposits at the cost of providing succour to the common man.

Vedi chairman Karakulam Krishna Pillai contested some of the claims made by the government to justify its decision. He said the claim that the new bank would advance loans at reduced interest rates was baseless as NABARD’s refinance made up hardly 10% of the agriculture loans advanced by the cooperative banks.

Moreover, the State cooperative bank and district cooperative banks as well as the proposed Kerala Cooperative Bank would become redundant under the NABARD’s new credit policy since the national bank would extend refinance facility directly to primary cooperative banks for agriculture loans.

At present, several primary cooperatives were utilising this mechanism, he said.

Similarly, there was no basis for the government’s claim that the new bank would fill in for the State Bank of Travancore as Kerala’s own bank after its merger with the State Bank of India. The SBT’s status was confined only to the fact that it was formed by the Travancore royal family. Beyond that the State government never had any control over it.

Mr. Pillai challenged the State government to publish the details of the so-called public hearing it purports to have conducted ahead of taking a decision on the Kerala Cooperative Bank. The government has kept every one in the dark about the contents of the M.S. Sriram committee report, which was submitted on April 28. The Congress party and the United Democratic Front will organise a series of agitations against the move.

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Printable version | Feb 20, 2020 11:11:03 AM |

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