The Hindu : Financial sector, a step behind reforms: Jaswant Singh

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Friday, Apr 04, 2003

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Financial sector, a step behind reforms: Jaswant Singh

By Oommen A. Ninan

MUMBAI April 3. The Union Finance Minister, Jaswant Singh, today urged the banking sector to provide adequate credit to agriculture and the small-scale sector, while complaining that the banks had not done enough to bring down the interest rates, despite the soft interest rate policy of the Government.

"I urge you to recognise the policy of lowering of interest rates and at the same time meeting the requirements of pensioners and other weaker sections of society," Mr. Singh said, while delivering the keynote address at the Banking Summit 2003 organised by the Confederation of Indian Industry, here.

The financial sector was remaining a step behind the economic reforms, which started in 1991. Banking is an "act of trust" and bankers should give the best of services to their customers. He asked bankers to change their attitude towards agriculture and small-scale sectors. "Credit for motor car is available easily, but credit for tractor and motor pump is difficult," he said.

On the recently adopted Securitisation Act, Mr. Singh said: " it gives enormous powers to the banking system to collect debt from the guilty, but the essence of the power is to understand the limits of power.'' This Act should not be used to "kill industry and commerce".

Dismissing fears of crude oil prices shooting up in the wake of the Gulf war, Mr. Singh said the country had already absorbed the volatility in crude oil prices and "the worst is over". The economic fundamentals were never so sound. "We have enough foreign exchange reserve to meet the import requirements of 15 months and our Rabi crop will be better than last year's," he said adding that "the Gulf war cannot defeat us politically and economically".

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