‘Giving J&K Bank overdraft facility to RBI a blow to state autonomy’
31 March 2015 11:29 PM GMT
The National Conference, however, said that every bank in the country has to function under RBI and the issue had nothing to do with the institution of autonomy. During a discussion on demand of grants in the state legislative assembly, the Chief Minister said, “... the biggest setback to the autonomy was when the previous government shifted the ways and means (concerning overdrafts) from Jammu and Kashmir Bank to the Reserve Bank of India.”
He said that earlier the state government used to withdraw overdraft from the Jammu and Kashmir Bank to meet its financial needs and used to pay interest to the bank, which used to again reach the people of the state. Mufti was speaking on the demand of grants for the departments held by him. Grants of departments GAD, Home, Tourism and Information were passed by the Assembly on Monday.
“We used to draw overdraft of Rs 2000 to 2500 crore from the Jammu and Kashmir Bank. It was like taking money from our own house. When the money used to come (from centre), we paid the interest and it again was given back to our own people,” he said. He said that handing over the “ways and means” of the bank to RBI by the previous government was a major setback to the institution of autonomy of the state. While extending his government’s full support to J&K Bank, Mufti said that his government would renegotiate the terms with the Government of India.
“We will try to renegotiate the terms with the Government of India, but from this House I want to say that we stand behind Jammu and Kashmir Bank, we completely support the bank,” he said. He said that the businessman in the state who take loans from the bank return the same with interest, whereas when loans given to business establishments from outside the state, the same get defaulted. “The money given to the local businessman comes back with interest, but when the same money is given to the outside businessman gets defaulted,” he said.
Later, the National Conference objected to the Mufti’s statement where he termed bringing of J&K Bank under the purview of RBI was the “biggest setback to the institution of autonomy”. National Conference MLA and former Finance Minister Mohammed Shafi (Uri) said, “Every bank operating in the country has to function under RBI and this has nothing to do with the institution of autonomy.”
He said that earlier the state government used to withdraw overdraft from the Jammu and Kashmir Bank to meet its financial needs and used to pay interest to the bank, which used to again reach the people of the state. Mufti was speaking on the demand of grants for the departments held by him. Grants of departments GAD, Home, Tourism and Information were passed by the Assembly on Monday.
“We used to draw overdraft of Rs 2000 to 2500 crore from the Jammu and Kashmir Bank. It was like taking money from our own house. When the money used to come (from centre), we paid the interest and it again was given back to our own people,” he said. He said that handing over the “ways and means” of the bank to RBI by the previous government was a major setback to the institution of autonomy of the state. While extending his government’s full support to J&K Bank, Mufti said that his government would renegotiate the terms with the Government of India.
“We will try to renegotiate the terms with the Government of India, but from this House I want to say that we stand behind Jammu and Kashmir Bank, we completely support the bank,” he said. He said that the businessman in the state who take loans from the bank return the same with interest, whereas when loans given to business establishments from outside the state, the same get defaulted. “The money given to the local businessman comes back with interest, but when the same money is given to the outside businessman gets defaulted,” he said.
Later, the National Conference objected to the Mufti’s statement where he termed bringing of J&K Bank under the purview of RBI was the “biggest setback to the institution of autonomy”. National Conference MLA and former Finance Minister Mohammed Shafi (Uri) said, “Every bank operating in the country has to function under RBI and this has nothing to do with the institution of autonomy.”
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