Agartala, Nov. 13: A flagship scheme of the Tripura government, the Swavalamban scheme for the self-employment of youths, especially for those belonging to Scheduled Castes, Scheduled Tribes, OBC and women, seems to be falling flat as a result of the non co-operation of banks in the state.

According to information available from a recent meeting of the state-level bankers committee, in 2015-2016, the state government had sponsored 5,729 applicants for a loan under the Swavalamban scheme, requiring bank finance of Rs 158.56 crore. However, the banks had financed only 2,313 applicants, disbursing only Rs 45.85 crore.

"This is a dismal scenario. To avail of the Swavalamban scheme, the applicants have to give only 5 per cent of the total project cost and 95 per cent is to be given by the banks, of which 30 per cent is given as subsidy by the state government. For women, the subsidy limit is 35 per cent. But unless the banks co-operate, the scheme cannot succeed," said CPM office secretary Rakhal Mazumder.

He said the Swavalamban scheme is based on projects for agriculture and allied activities like horticulture, pisciculture, floriculture, mulberry rearing, cash crop plantation and others that yield a ready income within a short time.

"The scheme is not making much progress because banks do not show much interest in financing projects based on it. In 2016-2017, not a single case has been sponsored or financed. The industry department of the state government, which is the nodal department for the Swavalamban scheme, seems to be losing interest," said Mazumder.

He said the state government would soon take up the issue with the banking authorities in the state for easy and early sanction of loans and advances for the project.

However, S.K. Lahiri, the senior regional officer of a nationalised bank, said despite improvement in the recovery rate of loans in Tripura the Swavalamban scheme was vulnerable because of the term and conditions of the scheme.

This is happening at a time when the credit-deposit ratio of the banks operating in Tripura has registered a rise from 33 per cent during days of insurgency to 45per cent in June this year.

"The credit-deposit ratio has improved because banks now find it safe to invest in Tripura through loans and advances but this is obviously not applicable to schemes and projects where there is uncertainty over recovery," said Lahiri.

He, however, conceded that the overall recovery rate of banks in Tripura has considerably improved from 20 per cent to 58 per cent in June.

Even in the corresponding period last year, the recovery rate was 55 per cent.

"We have a very bitter experience on many loans. Specially the now-defunct Prime Ministers Employment Guarantee Programme (PMEGP) in which the recovery rate was barely 3 per cent. That's why bankers fear to advance loans for the Swavalamban scheme, which has several components that work against recovery," Lahiri added.