Entry of ‘private cherry pickers’ into the Regional Rural Bank (RRB) Board will amount to a mindless crime against an already distressed farm economy, according to Tapan Sen, MP. This is one important reason why the Regional Rural Banks (Amendment) Bill, 2014, needs to be opposed both within and outside Parliament, he adds.

Two-thirds of farmers in the country don’t have access to institutional credit; dilution of RRBs will only aggravate the crisis, Sen told BusinessLine .

Earlier, opposing the Bill in Parliament, he requested Finance Minister Arun Jaitley to seriously review the present structure of operations of the RRB-sponsored bank model.

“It does not seem to be working. Sponsor banks are commercial banks. They have their own business priorities, and rightly so.”

According to Sen, there must be a national-level apex body for RRBs in association with the National Bank for Agriculture and Rural Development (Nabard), with an umbilical relationship with the RBI. It should be manned by a management and work force that are totally sensitised to the orientation on how to utilise and expand credit facilities to the remotest corners of India’s rural economy, he said.

It must strive to make available productive credit for agriculture, which is in dire straits now, he added.

“More than 70 per cent of the population depends on a particular occupation but its contribution to the GDP is only 13 per cent. This needs to be drastically changed,” Sen observed.

Related Topics