Growth with stability and equity is the undertone of the budget presented by the Honourable Finance Minister. There is great emphasis on developing the social infrastructure to ensure sustainable growth. Education has been given a place of prominence. For the benefit the less privileged, an education of cess of two per cent is proposed and the amount of Rs 4000-5000 crore will be exclusively earmarked for education.
Along with the emphasis on basic education, technical and higher learning also are given importance. The upgradation of the industrial training institutes proposed will help create technical manpower to meet the needs of the industry. In respect of higher education, Banks have been granting loans up to Rs 7.50 lakh for courses in India and to the extent of Rs 150 lakh for overseas studies. Loans up to Rs 4 lakh were exempt from the requirement of collateral. This exemption limit is now enhanced to Rs 7.50 lakh with the requirement of a satisfactory guarantee.
The senior citizens and the middle class who save a portion of their earnings and help capital formation in our country have been adversely affected by the fall in interest rates .
Responding to the aspirations of this important segment, the administered rates in small savings instruments, PPF, GPF, and special deposit schemes were left undisturbed at eight per cent for the year. In the absence of social security schemes which will address issues like the medical expenses and the impact of inflation, retired persons have been the worst affected. The introduction of a new savings scheme with nine per cent interest is a welcome relief for the senior citizens.
{{/usCountry}}Responding to the aspirations of this important segment, the administered rates in small savings instruments, PPF, GPF, and special deposit schemes were left undisturbed at eight per cent for the year. In the absence of social security schemes which will address issues like the medical expenses and the impact of inflation, retired persons have been the worst affected. The introduction of a new savings scheme with nine per cent interest is a welcome relief for the senior citizens.
{{/usCountry}}The experimental introduction of food stamps is a well meaning initiative to remove the leakages in the public administration system
For the banking system an enabling environment will be created for lending to agriculture, with the initiatives contemplated for the improvement in physical and social rural infrastructure, exemption of excise duty on tractors, dairy equipments and hand tools and the ambitious and noble endeavour to repair, renovate and restore water bodies throughout the rural areas in our country. A more vibrant rural economy where the farmer has more purchasing power will be a good market for the goods and services produced by the corporate sector.
The proposal to bring in amending legislation in respect of the Securitisation Act and the DRT Act, while being fair to the borrower and lender is expected to expedite recovery of the non performing assets of the banking system.
(K Cherian Varghese is chairman and managing director, Corporation Bank. Views expressed are personal)