Credit flow outpaces deposit growth in MP

Bhopal, June 26 (UNI) With credit flow far outpacing deposit growth in Madhya Pradesh, the credit-deposit ratio of the banking sector has touched a high of 71.94 per cent at the end of last fiscal as against the national norm of 60 per cent.

Improvement in credit-deposit ratio was a result of surge in flow of credit to agriculture and other priority sector, the State-Level Bankers Committee, which reviewed the performance of the banking sector during 2005-06, was informed here today.

The committee's 124th meeting, presided over by Central Bank of India General Manager (Priority Sector) R K Kalia, also fixed the state's annual credit plan for 2006-07 at Rs 10,482.79 crore, bank sources said.

Narrating the national and international scenario, Mr Kalia said the growth trend for the last three years indicated the beginning of a new phase of cyclical upswing in the country's economy with all major sectors like agriculture, industry and services providing the required fillip.

''Banks are now offering the facility of 'no frills' banking to integrate the unorganised sector of the society with the banking system'', he said.

Mr Kalia lauded the launching of 'Khet Talab Yojana' by the Madhya Pradesh government for water conservation by constructing about one lakh farm ponds within one year with financial assistance by banks.

On the performance of banking sector in the state, Mr Kalia said though there was all round growth on the credit front the growth was not commensurate on the deposit front. The deposits increased by Rs 2809 crore at a growth rate of 4.78 per cent whereas advances grew by a whopping Rs 9237 crore over March 2005 registering a growth of 26.33 per cent.

SLBC Convenor and Central Bank of India Deputy GM R P Tripathi said credit flow to agriculture sector had doubled in the last two years as against 3 years period set by the Government of India. The achievement index under last year's annual action plan was 114 per cent as aganst 87 per cent during the previous year.

The SLBC is closely monitoring the performance of banks in Jhabua and Ratlam districts, which have been identified for cent per cent coverage of farmers for issuing Kisan Credit Cards, he added.

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