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CHENNAI, Aug. 1

THE National Bank for Agriculture and Rural Development (Nabard) has agreed to increase the assistance to Tamil Nadu under the Rural Infrastructure Development Fund (RIDF) to Rs 400 crore during 2002-03, against the originally planned amount of Rs 350 crore.

This assurance was given at a meeting a team of officials from the Nabard, led by its chairman, Mr Y.C. Nanda, had with the Chief Minister, Ms Jayalalithaa, Ministers and officials at the Secretariat on Thursday.

During the hour-long meeting, the Tamil Nadu Government made out a case for higher assistance from NABARD for the various development programmes being taken up by the Government. The Chief Minister explained to the NABARD officials the steps being taken by the Government to create rural infrastructure throughout the State.

In particular, Ms Jayalalithaa wanted increased assistance from Nabard for secondary grade schools and upgradation of primary health centres into 30-bed mini hospitals in all the 385 panchayat unions.

According to a State Government press release, the Chief Minister requested Nabard to extend refinance facility to the Tamil Nadu Industrial Investment Corporation for implementing the New Anna Marumalarchi Thittam, which envisages establishing agri-business units in all the panchayat unions.

She said that in the last three years, Nabard had increased the rate of interest by 1.5 per cent on its advances to self-help groups, assistance to State Government for share capital participation and short-term credit limits for marketing of agricultural crops. She wanted this rate of interest to be reduced from present 8.5 per cent to 6.5 per cent or seven per cent.

Ms Jayalalithaa pointed out that for 2001-02, Tamil Nadu had utilised loan under the RIDF to the extent of Rs 288.48 crore for various projects including highways, irrigation, rural roads, construction of secondary school buildings, and upgradation of primary health centres. For the current year, it was proposed to draw Rs 350 crore mainly for improving schools and upgrading primary health centres, she said and requested Nabard to consider increasing the amount of refinance to the State.

She said that Nabard should also consider refinancing loans extended for new requirements in rural areas such as purchase of computers and formation of internet kiosks.

To increase Nabard refinance to the State, the bank should relax the norm of 25 per cent minimum lending in short-term agricultural loans in the case of State apex cooperative banks and 40 per cent in the case of District central cooperative banks on a par with refinancing of regional rural banks.

The Chief Minister told the Nabard delegation that in the Tenth Plan period, Tamil Nadu had to secure a four per cent growth in the primary sector. The Government had to take a comprehensive view of agriculture and rural development. She said the Government was taking steps to improve the co-operative credit system.

During the meeting, Ms Jayalalithaa highlighted the problem caused by the stagnation of handloom stocks due to poor market conditions and requested the Nabard Chairman to consider revising the credit limit of co-operative banks for lifting the handloom stocks. This should be looked into sensitively in view of the distress faced by the handloom weavers, she said.

The release said the Nabard Chairman agreed to look into all the requests made by the State Government and take steps to come out with necessary packages in terms of credit and refinance in various sectors like cooperation, agriculture, education, health, highways, handlooms and rural industries.

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