'25.81 pc increase in bank credit to SMEs'

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New Delhi, Dec 4: There has been an over 25 per cent increase in the credit by Public Sector banks to the Small and Medium Enterprises (SMEs) during the year 2006-07 compared to the previous year, the Rajya Sabha was informed today.

In a reply during Question Hour, Minister of State for Finance S S Palanimanickam said,''the Public Sector banks have shown a 25.81 per cent year-on-year growth in credit outstanding to the SME sector for the year 2006-07 over the year 2005-06.'' The Minister said the Centre had announced a policy package in Parliament on August 10, 2005 for stepping up credit to SMEs. Under the policy, all scheduled commercial banks including Public Sector banks have been advised to fix their own targets for funding SMEs in order to achieve a minimum 20 per cent year-on-year growth in credit to the SME sector.

Replying to supplementaries, the Minister said to encourage credit lending to the SMEs and the Small Scale industries, it had been decided by the Government to set up a branch of Public sector banks in each state Capital for the sole purpose of lending credit to the SSIs.

While, as per policy, a loan of upto Rs 25000 to SSIs was cleared within a fortnight, that of above Rs 25000 is to be cleared within eight weeks.

In reply to another question, Finance Minister P Chidambaram said the number of Foreign Institutional Investors engaged in trading in share markets had increased after the banning by the Government of participatory notes in the share markets.

He said the number of FIIs registered in trading had increased from 1113 on October 16 to 1157 on November 15.

In reply to a supplementary by Shahid Siddiqui whether the Government had come across any case of persons with terrorist links investing in the share market, the Finance Minister said recently one case of investment in the share markets by persons suspected of links with terrorist outfits had come to the notice of the government.

However, he did not give details of the case as the matter was still being investigated.


UNI

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