Patna industry department secretary CK Mishra addresses the conference in Patna on Wednesday. Picture by Deepak Kumar

Patna, Dec. 22: The state industries department principal secretary C.K. Mishra today urged banks and financial institutions to come forward to boost private investment in the state.

Mishra said the state government has done the bulk of investments through public expenditure but the financial institutions and banks were still lagging behind.

The principal secretary was attending a seminar on banking, insurance, capital markets and financial institutions, organised by Confederation of Indian Industries (CII) in the capital.

“There has been a perceptible change in the state in past few years. The turnaround the state has made in terms of public expenditure is huge. The investment made by the state government is nearly Rs 14,000 to 15,000 crore. Earlier it was only a few hundred crore. The government intends to earmark an outlay of Rs 25,000 crore,” added Mishra.

“Unfortunately financial institutions and banks are not coming forward to help with the investments,” said Mishra.

Mishra said: “The low credit deposit ratio is a major cause of concern. The banks are making profit but they have been unable to reach out to the common man. Industry bodies, banks and other financial institutions should sort out these issues.”

The principal secretary said industries are going to be a major focus area for the state government in 2011. Hence it was time to start thinking big. But that would not be possible if banks continue to put the state on small category.

“If we continue to put Bihar in the small category then we are losing out. We have to make it into a win-win situation for both of us (banks and the government). The government will plug the loopholes by playing a supportive role,” he added.

Gyaneshwar Pathak, assistant general manager of the Reserve Bank of India, said of 38 districts of the state, 16 districts have already achieved the target of 100 per cent financial inclusion programme and 19 districts have been taken in the second phase.

Around 26.19 lakh accounts have been opened in the state till September 2010 out of which 23.70 lakh are operational. These accounts have been opened under the financial inclusion programme through which banking services are made available at an affordable rate to the disadvantaged and low-income groups by opening such accounts, Pathak said.

“Merely opening an account is not going to help. It is equally important to see as to how many of them are actually operational. Many such accounts have become dormant and it is the responsibility of the banks to give impetus to account holders in the form of over-draft,” he said.

Besides opening accounts, it is equally important that the account holders should be made aware about the banking products available to them, said Pathak. He also said 14 financial literacy credit and counselling centres have been opened in the state to sensitise the customers. Nabard has come forward to help at places where no counselling centres were operational, said the assistant general manager.

CII Bihar state council chairman Satyajit Singh expressed concern on the low credit deposit ratio of around 30 per cent and said banks should do a lot to improve.