‘Goonda banks’ shock FM

PATNA: Union finance minister P Chidambaram was shocked on being told that ‘goonda banks’ had come up in a few Bihar districts as the nationalised banks had stopped lending money.

Chidambaram was attending a state-level meeting of the coordination committee of bankers here.

Reacting to Bihar chief secretary GS Kang’s charge that 700 bank branches in the state had not been lending any money, Chidambaram said, “A bank that does not lend money is not a bank.” He warned that the bankers should improve their performance particularly the credit: deposit ratio  within the next three months or be ready to face strict action.

Chief Minister Nitish Kumar informed Chidambaram about the ‘goonda banks’ that had flourished in some parts of eastern Bihar as nationalised banks were not lending money to the needy. People were then forced to go to these ‘goonda banks’ and take loans at a much higher interest rate.

The police had recently busted these illegal banks which are suspected to have been started with ransom money from the kidnapping industry that flourished in Bihar during the last 15 to 20 years.

Later, addressing a joint press conference with the Bihar CM, Chidambaram said the country could not achieve the desired progress rate by overlooking the progress of Bihar where eight per cent of its people live.

Nitish Kumar urged the Centre to grant an economic package for the backward state on the lines of those given to Himachal Pradesh, Uttaranchal and the North-Eastern states. Kumar also submitted a seven-page memorandum to Chidambaram