Cong against Rs 270-cr grant to state bank | mumbai | Hindustan Times
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Cong against Rs 270-cr grant to state bank

mumbai Updated: Mar 14, 2011 01:52 IST
Dharmendra Jore
Dharmendra Jore
Hindustan Times
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The Nationalist Congress Party’s (NCP) demand of granting Rs270 crore to the Maharashtra State Cooperative Bank Limited — which is in a financial mess allegedly because of its suspicious decisions to give loans to smaller banks and loss-making sugar factories — has been put on hold by its ally Congress.

The decision to give the bank a loan guarantee of Rs270 crore was made at the last cabinet meeting. But, when the deputy chief minister and finance minister Ajit Pawar, who controls the bank, asked the cabinet to convert the bank guarantee amount into a non-returnable grant, the Congress ministers turned down the proposal.

The bank needs a total bank guarantee of Rs1,170 crore. Last week, it was decided, that the bank would submit its accounts to the government for verification and also withdraw cases against the government in the court. Chief minister Prithviraj Chavan had also agreed to it.

However, at the Sunday meeting, Congress ministers Narayan Rane, Patangrao Kadam, Nitin Raut, Harshvardhan Patil and Radhakrishna Vikhe Patil argued that a bank that has failed in carrying out a profitable business should not get any assistance from public money.

Putting the proposal on hold, they insisted that the bank improve its performance.