Loans under CMRY decline owing to mining shutdown

NT NETWORK

PANAJI

The Chief Minister’s Rozgar Yojana (CMRY) of the Economic Development Corporation (EDC) that is aimed at creating self-employment among the local youth is facing a slowdown.

Loans under the scheme fell eight per cent in 2017-18 compared to the previous year. While Rs 18 crore was sanctioned under CMRY in 2016-17, the loans dropped to Rs 16.5 crore in 2017-18 (up to February-end).

A senior official in charge of the scheme attributed the decline to mining closure. “The mining belt has gone completely dry and we are finding it difficult to lend in talukas such as Sattari, Valpoi, Bicholim, Sanguem, Quepem and to some extent Pernem,” said the official.

He said that in the past, CMRY loans funded various small businesses in mining areas such as general stores, guest houses, bars, provision shops etc. But with no activity in the area, there are few takers for loans. The official said that currently most of the loan applications are with regard to sale of readymade garments. “Too much exposure to one type of business is making us cautious in granting loans to garment retailers,” he said.

Speaking to this daily, Sidharth Kuncalienker, chairman of EDC, said that the EDC is trying to change its disbursement model in mining areas. The Corporation is reworking its strategy in the belt to increase loan offtake, he said.

“We are working with GSIDC to create self-employment opportunities for youth in mining belt by encouraging them to take up contracting jobs,” said Kuncalienker. “Contracting works generate a lot of jobs and we are trying to make contractors out of local youth by giving them small GSIDC contracts in the range of Rs 25 lakh,” he said. Kuncalienker said that GSIDC has several small projects in mining areas.

EDC’s lending under CMRY, the flagship scheme, jumped 45 per cent in 2016-17 on top of similar healthy growth over the years. Till date, the scheme sanctioned loans to 6,312 small borrowers for funding a variety of self-employment activities ranging from fabrication units to papad- and pickle-making units.

About 50 per cent of the beneficiaries under the CMRY scheme are operators of rent-a-bike, tourist taxis, yellow-black motorcycles, rickshaws etc. The EDC had put a moratorium on lending to autos, rent-a-bike and taxis but with the tourism industry picking up, the scheme has restarted funding to the sector.

The CMRY scheme offers loans up to Rs 25 lakh and at cheap rate. Fifty per cent of the loan is interest-free and on the balance, interest is charged at eight per cent and six per cent, respectively for men and women borrowers. For women SC or ST borrower, 80 per cent of the loan is interest-free. The loan recovery rate ranges between 88- 90 per cent.