RRBs to merge within the same state by August: Chidambaram

If one bank has more than one RRBs in a state, then all of them have to be consolidated into one, he said, adding ‘‘the entire process will be completed by August 31, 2005.’’

The FM said NPAs were major area where the Finance Ministry would monitor performance of banks. He pointed out that NPAs of banks had come down to the level of 3 per cent and the next year’s target would be to reduce it to the level of 2 per cent.

As far as the consolidation of commercial banks was concerned, Chidambaram said the government would decide in due course after considering all suggestions from various quarters. He however, ruled out diluting government stake below 51 per cent in PSU banks.

The FM added that all banks would have to sign a MoU with government by June end or first week of July to improve other financial parameters.

Setting a new farm credit target of Rs 1,41,000 crore for 2005-06 as against Rs 1,15,000 crore disbursed last fiscal, Chidambaram said, ‘‘credit to SMEs will be taken up as the next thrust area.’’ He said there would be a statement on SMEs credit setting out a policy and norms to increase flow of credit.

‘Financial package for sugar industry by June’

NEW DELHI: Finance Minister P. Chidambaram on Friday said a financial package for cooperative sugar mills hit hard by two successive droughts will be finalised by this month end. The government has identified 61 co-operative sugar mills for the rehabilitation package which would be announced by the end of the month, he said. There are 26 other sugar co-operative mills which do not require financial package, he added. — PTI