Andhra Pradesh today asked the Centre to consider giving one time financial assistance and an attractive package to cleanse the balance sheets of the cooperative banks, as was done for the commercial banks and the Regional Rural Banks (RRBS). Raising bonds by both the Central and state governments with shares from the members will not address the problem squarely and completely. The one time assistance would go a long way in this direction, Andhra Pradesh Chief Minister N Chandrababu Naidu told the Chief Ministers' conference on cooperative credit structure in Hyderabad.
Naidu's speech was read out by state minister for cooperation C Ramachandra Rao. The Centre can not absolve itself of the responsibility to support the cooperative structure, he said if support does not take place, the consequences will be quite disastrous to the economy.
Emphasising that there was a need to re-look at the existing structures for rural credit, he said the Centre and RBI needed to take a serious look at the need for enhancement in the general line of credit from RBI and channeling it directly to the state level cooperative banks instead of routing it through NABARD and thereby reduce the interest rates of finance to the cooperatives. Bureau Report