Madam, as far as this Bill is
concerned, I do not find too many clauses where we need to have long
discussions because it is a very simple Bill for transferring the ownership. At
one time, the ownership rested with the Reserve Bank of India. Now it is being
changed to the Government of India. I do not think much needs to be said about
clauses and the Bill which everyone of us will automatically support. This
could have been done even earlier. In this context, I wish to express some of
my opinions in regard to improving the banking and economy of this country. At
the time of Independence when there was no corporate sector in India, and when
we were depending on outside investors, it had become a necessity for the banks
to finance the public sector undertakings140
and also the corporate sector which came forward. Much of the money used to go
only to the corporate sector160
and the rich people who were investing in industry and trade. Today, the
situation is changed. A situation has come where our corporate sector is in a
position not only to invest in this country, but also to go to other countries,
including America and Europe and invest there. So, my humble suggestion to the
hon. Finance Minister is to think in terms of reducing the lending to high
corporate sector where they have got crores and crores of rupees with them. So,
we should not utilize the public money lying in the form of deposits in banks
for the purpose of lending to millionaires. The same money can be given to the
poorer sections of society which they can280
utilize not only for improving their livelihood, but also to add to the wealth
of the nation. Please think on the point whether we can put an end to financing
from banks to the major industrial sector which is320 very successful, particularly the profit-making
corporate sector. We can divert a lot of funds to the fresh investors and
professionals, to the people who have got some research and development done,
and who have got innovate ideas. They can be helped with money, if they have
got bright ideas with substantial evidence of success for the projects which
they think of. Statistics reveal that much of the exports are being done by
small and medium enterprises. Similarly, in regard to financing the priority
sector, we were allocating only about 40 per cent of the total deposits. This was
done decades back420 when the
corporate sector was not developed. But, today, with 70 per cent of people
living in villages and 58 per cent of the people surviving on agriculture, it
is time for us to increase this allocation ratio of 40 per cent to the priority
sector to at least 60 per cent, so that money would be available to480 the small-scale sector as well as the
agricultural sector and professionals among poorer sections of society. We find
that a lot of banks are not even fulfilling that 40 per cent or 18 per cent
agricultural financing. So, I wish that the Government must take a serious note
to think about increasing the priority sector lending, so that we may take care
of the real need of the poorer sections and replan the economy of this country.
As
regards micro-finance, we560
hear a lot of things, particularly in Andhra Pradesh, that some of these
micro-finance companies have been charging about 50 per cent from the poorer
sections of the society. Where did they get that money? It is not their own
money. Some of the banks, which find that the transaction cost is more for
them, are giving crores and crores of rupees to the micro-finance companies.
This should have been given under priority sector by the main banks at640 a lower rate of interest to the users.
They are transferring it to the micro-finance companies as if they were going
to do priority sector lending. I can understand if those people were to come
with non-profit motive, but even those micro-finance private companies are
profit-motivated. Hence, they are squeezing interest from the poorer sections
of the society. So, I wish700
the Government to take note of the fact that no major bank should lend priority
sector funds to the micro-finance companies. It must be done by them only or it
should be given to an institution, which is a non-profit entity. We have got a lot
of charitable institutions in this country who are doing service to the poorer
sections of the society. We have also got new avenues now, particularly, the
women’s self-help groups in this country, who are utilizing these funds
excellently well. We can see the glow on the faces of women in the villages800 because they are earning some money. So,
these self-help groups can be encouraged in a big way. I wish that the
Government seriously thinks about it, and there should not be a loss of time in
curbing the number of micro-finance840
corporations to be given money from the banks. It is public money which can be
passed on directly to the Self-Help Groups. Similarly, majority of the private
sector banks open their branches only in urban areas where transactions are
running into millions and crores. These banks do not have the commitment to
lend to the poorer sections of the society in the villages. So, they do not
open branches in the rural areas. It means that there is no level-playing field
between the public sector banks and the private sector banks. There must be
level-playing field, and the same guidelines must be applied and strictly
enforced. The private sector banks are mainly avoiding this stipulation of
priority sector lending960 by
transferring this money to the micro-finance institutions, which is doing
tremendous amount of harm to the poorer sections of the980 society.
Right
from 1985, I have been telling in this House that the role of the banks is
excellent. If we were to provide Rs. 10 lakh crore in the Budget, then the
banks can do more good to the society and to the economy of this country than
the budgetary provisions. It is because we will make the budgetary provisions
only once, but the banks can lend to a borrower and recycle it 10 times. So, who
is going to give them better dividend? Who is going to create more wealth in
this country? It is the poor man or it is the common man who is going to do
that. Unless they do some mischief, no major company can afford to make that
much return. I wish that these banks must identify the right borrowers, more
particularly in1120 the rural
areas, so that their wealth and their living standards may go up, at the same
time increasing the wealth of the nation. In that regard, if the Government
were to give the target that this priority sector lending must be done
amounting to so many crores, then they will immediately catch the voters’ list
and prepare the names of the borrowers. That should not be the case. When
priority lending is done, all those borrowers must be identified and they must
be trained in a profession where they are interested, and then only the lending
must be linked to them. In such a manner, all that money that is given to them
can be put to extensive use and the returns will be more. By merely saying that
we have given so many crores of rupees to the1260
poorer sections of the society will be of no use.
In
this context, I will give an example in this1280
House. I am running a charitable trust providing skills in various professions
totally free. In my constituency, when my people approached some Muslim
families requesting them to send their women for learning some skills, they
refused to send their women. They said that they were ready to starve but would
not send their women outside for learning the skills. When my people convinced
them, they ultimately agreed to send their women provided they were trained
separately in a different room. We agreed for it, and some of them learnt
making phenyl. At the end, when they were fully trained, I called the District Collector
to give the certificates to the trainees. The Collector, who happens to be a1400 woman, randomly asked a Muslim woman in
what profession she was trained. The Muslim woman replied by saying that she
was trained in making phenyl. The Collector asked her whether she was confident
of making this phenyl on her own1440
without support from anybody, to which she replied in affirmative. When she was
asked whether she could earn money out of it, she again gave a positive reply.
When she was further asked as to why she was not doing it in her own house, she
replied by saying that she did not have money and she had no investment. When
it was enquired as to how much money was required by her, she said that she
would require Rs. 1500. When the Collector asked her how much money she would
make out of it, she replied that she would easily make Rs. 100 every day. That
was the condition prevailing in those areas. In these cases, we need to take
the lead and see what kind of policies are to be formulated by the Government. Every
law, every Act, every programme and every policy we make must be able to
motivate the people and must give them1600
the ability and resources to make wealth for this nation.
