RBI nominates minority-dominated regions for banks’ priority lending schemes

Bombay: In a significant move, the Reserve Bank of India (RBI) has released a list of states, union territories and districts dominated by different minority communities to expand priority lending schemes implemented by commercial banks regularly in the country.

Currently, the Union Ministry of Minority Affairs has classified Sikhs, Muslims, Christians, Zoroastrians, Buddhists and Jains as “minority communities”.

The RBI has listed 121 districts where the minority population component is at least 25%, plus the states of Punjab, Meghalaya, Mizoram, Nagaland and the union territories of Jammu and Kashmir, Ladakh and Lakshadweep.

In accordance with RBI’s most recent Principal Circular, dated August 2, partnership companies in which the majority of partners belong to one or more of the specified minority communities, advances may be granted to them and shall be treated as “Community Advances minority”. “.

Similarly, if majority beneficial ownership of a joint venture belongs to the minority community, it will be classified as an advance to that specific community.

However, since a company is “a separate legal entity”, the loans granted to it cannot be qualified as advances to specified minority communities, as of the current financial year, 2022-2023.

The Bharatiya Janata Party-led NDA government wants special oversight of the flow of credit to those minority-dominated districts, UTs, and states, and to ensure that these underrepresented categories “get a fair and equitable share of credit in the framework of the overall objective of the priority sector”.

Welcoming the government’s decision, Chairman of the Council for Rights Protection (CPR) Nagpur, Barrister Vinod Tiwari, said it would prevent big businesses run by certain minorities like the Jains from hogging a large chunk of the loans of the priority sector granted by the banks.

“Now the government and RBI should disclose the actual data minorities have benefited from and to what extent under this policy from 2014 when Jains were also declared a ‘minority community’ for the first time in India” , he demanded.

Welcoming the initiative, prominent stock market consultant Rajesh Shah from Mumbai said that with the departure of the “big fish”, truly deserving minorities would easily get bank loans.

“Several companies, especially the Jains in the property sector, have taken huge loans, many have even defaulted, but now with the new guidelines, these people will no longer be eligible for loans due to their ‘minority’ status alone. ‘”, did he declare.

The chairman of the Pune-based Muslim Chamber of Commerce and Industries (MCCI), Nisar Sagar, said he would properly study the new guidelines before commenting.

“Nevertheless, I can confidently say that Muslims have not been discriminated against on this basis… Depending on their business plans and guarantees, and if they meet other criteria, they are granted commercial loans as needed,” Sagar told IANS.

Nationalist Congress Party minority cell chairman Mohammad Khan-Pathan said that although government programs are available, awareness is very low, especially among Muslims, due to lack of education and orientation, they are therefore always deprived of these advantages.

Tiwari said, given the new rules, “what will be the fate of those border districts where the minority population is below one or two percent”, and why a large minority community like the Sindhis have been excluded from this program “of inclusion”.

“To make complete sense, the government and RBI need to release details of the number of people from different minorities who have been the true beneficiaries of this scheme, and whether it is proportionate to their population or not,” he said. he urged.

The RBI list of 121 districts where minorities are at least 25% is led by Uttar Pradesh with 21 districts, Kerala (14), Assam (13), West Bengal (12), Maharashtra (9 ), Arunachal Pradesh and Bihar (7 each). ), Manipur (6), Jharkhand and Sikkim (4 each), Karnataka (3), Delhi, Haryana, Himachal Pradesh, Mizoram, Uttarakhand, Andaman and Nicobar Islands UT (2 each), Telangana, Madhya Pradesh, Goa, Tamil Nadu, Odisha, Pondicherry, Rajasthan, Meghalaya and UT of Ladakh (1 each).

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