Chief Minister, Mehbooba Mufti, today urged premier banking institutions to reach out to state's young and budding entrepreneurs by helping them in establishing viable business units.
The chief minister said she expects Reserve Bank of India (RBI) to do more in exerting pressure on banks operating in the state so that small and medium enterprises have hassle-free access to loans. "We seek better cooperation of banks in creating ample opportunities of employment for youth in the state," she observed.
The Chief Minister was speaking at a luncheon meeting today with the RBI Governor, Dr. Raghuram Rajan, during which several issues relating to banking operations in the state were discussed.
Asking premier financial institutions to broaden the scope of their business operations, Mehbooba Mufti said banks need to focus on priority sector lending in the state, particularly targeting tourism, handicraft, handloom, agriculture and allied segments, which have a huge potential to generate avenues of employment for youth in J&K.
She said the state's economy needs resuscitation as it has gone through very difficult times in the past few years.
"We need to achieve RBI benchmark of 60 per cent CDR for which banking institutions have to scale up lending," she said, asking RBI to help J&K's efforts in creating job opportunities for talented human resource.
Dr. Rajan discussed with the Chief Minister a 12-point plan aimed at putting together a stronger financing structure in the state which goes beyond conventional banking.
He said the first priority will be to create linkages of finance by overcoming physical barriers which will help in integrating the state with the rest of the country and empowering young local entrepreneurs.
"We are taking measurable short-term initiatives. I think J&K is in a better position in making the state easy for financing, which can be a model for the rest of the country to emulate," he added.
Favouring uptick vis-à-vis lending in core sectors, Mehbooba Mufti said banks should look at social sector responsibilities as thrust areas and advance hassle-free loans to bright entrepreneurs and agriculturists. This, she observed will come as an elixir to J&K's economy, which is showing encouraging upward trend.
"The banks need to supplement the efforts of the state government in revitalizing industry and agriculture," she said.
The Chief Minister also requested RBI Governor to expedite working out modalities for establishing banking facilities for cross-LoC trade. She said the switch from barter to banking at two trading points of Salamabad and Chakan da Bagh will expand the scope and ambit of cross-LoC commerce.
The Chief Minister particularly sought RBI Governor's support in promoting business link-ups between large business houses and local entrepreneurs, keeping in view RBI's effective collaboration with top banking institutions.
Dr. Rajan stressed on branding of handicraft products by popularizing logos and bringing tour operators, hoteliers and other stakeholders under one platform to aggressively promote J&K as a niche high-end tourist destination.
Mehbooba Mufti also requested Dr. Rajan for facilitating institutional finance for setting up model villages for basmati, apple, mint and milk. On this, the RBI Governor said once government firms up Self Help Groups and milk cooperatives, the banks will be keener to finance liberally.