AIBEA points finger at banking policy for inflation, price hike

Puducherry,June 21(UNI) Stating the rise in inflation and prices of essential commodities had hit the common man bady, All India Bank Employees Association (AIBEA)General Secretary C H Venkatachalam today attributed the current banking policy as one of the reasons for the crisis.

Talking to newspersons here on the occasion of the VI State Conference of the Puducherry State Bank Employees Association beginning later in the day, Mr Venkatachalam said in 1969 even common man could avail a bank loan.

Following changes in economic policy, big entrepreneurs and business magnets were getting larger loans than agriculturists leading to price hike.

The move to reduce the number of public sector banks from 27 to four or five due to global competition must be abandoned and foreign direct investment(FDI) in banking sector should not be permitted.

Alleging not much attention was being given to rural banking, Mr Venkatachalam said during the last three years, about 5,000 bank branches were opened. Of this, only 50 branches were opened in rural areas.

He sought a change in policy on advances to ensure even the poor and the needy were given loans.

At least 40 per cent of the loans should be given to priority sector, he said adding though 18 per cent was earmarked for agriculture, only 14 perent was being provided presently.

He also urged for reduction in interest on loan from the present nine per cent to four.

Welcoming the government's decision to waive agriculture loans, Mr Venkatachalam said the poor farmers should benefit from it.

UNI PAB GM 1327