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Sushil Manav
Tribune News Service
Chandigarh, July 17
Uncertainty hangs over the fate of Haryana State Cooperative Agriculture and Rural Development Bank Limited (HSCARDB), having 76 branches in the state, as the Finance Department has red-flagged its continuation in the manner it is functioning at present.
The Tribune has learnt that with the defaulting amount of its debtors rising sharply and the recovery of loans falling every year, the state government was considering either the closure of the bank or merging it with Haryana State Cooperative Apex Bank Limited (HARCO Bank) and limiting its lending to the minimum.
Popularly known as Land Mortgage Bank due to its former name Haryana State Land Development Bank, the HSCARDB provides long-term loans to farmers for the purchase of tractors and other agriculture equipment and for land development etc.
Meanwhile, HARCO Bank and District Central Cooperative banks, set up in various districts under HARCO Bank, provide short-term loans till the next harvest for inputs like fertilizers and seeds.
Sources said the defaulting amount of HSCARDB’s debtors had crossed Rs 2,600 crore due to dwindling recoveries.
The bank has 76 branches across the state and nearly 7.25 lakh farmers were associated with these banks as customers.
The bank, according to sources, is running in losses to the tune of Rs 377 crore and its management has no clue how to repay Rs 900 crore to the National Bank for Agriculture and Rural Development (NABARD).
Finance Minister Captain Abhimanyu admitted that the government was considering several options, which included the closure of the bank, its merger with HARCO Bank or limiting its lending to the minimum so that the bank continues and its employees do not have to lose jobs.
“When the government went into the reasons behind the bad fiscal health of the bank, we learnt that influential politicians had misused their position by taking huge loans on their names and others from several branches. Then they got interest waived from the government by raising the bogey of farmers’ interests and got loans again within hours of the repayment,” Abhimanyu maintained.
The minister said the government would take a call on the future of HSCARDB very soon.
‘Govt to take call soon’
"When the government went into the reasons behind the bad fiscal health of the bank, we learnt that influential politicians had misused their position by taking huge loans on their names and others from several branches. Then they got interest waived from the government by raising the bogey of farmers’ interests and got loans again within hours of the repayment. The government will take a call on the future of HSCARDB very soon." — Captain Abhimanyu, Finance Minister
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