Global Investors Summit done, Uttar Pradesh turns to banks for credit line

The state has exhorted banks and financial institutions to support the investment roadmap by providing loans to the GIS projects

Bank, money, Banks
Virendra Singh Rawat Lucknow
2 min read Last Updated : Feb 20 2023 | 10:30 PM IST
After garnering investment proposals worth Rs 33.50 trillion at the Global Investors Summit (GIS) 2023, the Uttar Pradesh (UP) government has asked commercial banks to loosen their purse strings for private sector projects.

The state has exhorted banks and financial institutions to support the investment roadmap by providing loans to the GIS projects.

The pool of GIS projects is likely to play a major role in improving the credit deposit (CD) ratio of banks. Currently, the CD ratio of UP is nearly 53 per cent, but the Yogi Adityanath government is striving to touch 60 per cent.

“Today, the CD ratio of UP is 53 per cent compared to 46 five years back. Although it has increased, there is a need for further improvement to expand the scope of banking credit,” he said at a session on the banking sector.

UP Finance Minister Suresh Khanna said the GIS projects would not see the light of the day without the active support of the financial institutions. “The banks should provide easy loan facilities, so that the state harvests the benefits,” Khanna told the top management of leading banks.

In a report, the National Bank for Agriculture and Rural Development (Nabard) has also indicated poor access to institutional credit, lack of availability of raw materials at an appropriate cost, outdated design/skill development, and lack of common facility centres as impeding the growth of the micro, small and medium enterprises (MSME) sector.

Meanwhile, NABARD has estimated credit infusion of Rs 1.05 trillion to the MSMEs in UP during the financial year 2023-24. This will be 9 per cent higher than Rs 97,000 crore of the credit flow projected to the sector in the current fiscal year.

2022-23 (FY22-23)
 
Since UP is targeting to double its merchandise exports to Rs 3 trillion by 2027, the higher credit flow to the MSMEs would bolster the sector by overcoming the working capital requirements.

The total number of MSMEs in UP is pegged at 9 million. The sector accounts for 60 per cent of the state’s industrial output, and is the second largest creator of employment - after agriculture and allied activities.

Apart from credit, UP is anchoring the MSMEs to market their products globally through popular ecommerce platforms such as Flipkart and Amazon.

Nabard has also estimated an additional credit potential of Rs 6,200 crore in UP for boosting exports in 2023-24.

One subscription. Two world-class reads.

Already subscribed? Log in

Subscribe to read the full story →
Subscribe to Business Standard digital and get complimentary access to The New York Times

Quarterly Starter

₹900

3 Months

₹300/Month

SAVE 25%

Smart Essential

₹2,700

1 Year

₹225/Month

Save 46%

Super Saver

₹3,900

2 Years

₹162/Month

Subscribe

Renews automatically, cancel anytime

Here’s what’s included in our digital subscription plans

Access to Exclusive Premium Stories Online

  • Over 30 behind the paywall stories daily, handpicked by our editors for subscribers

Complimentary Access to The New York Times

  • News, Games, Cooking, Audio, Wirecutter & The Athletic

Business Standard Epaper

  • Digital replica of our daily newspaper — with options to read, save, and share

Curated Newsletters

  • Insights on markets, finance, politics, tech, and more delivered to your inbox

Market Analysis & Investment Insights

  • In-depth market analysis & insights with access to The Smart Investor

Archives

  • Repository of articles and publications dating back to 1997

Ad-free Reading

  • Uninterrupted reading experience with no advertisements

Seamless Access Across All Devices

  • Access Business Standard across devices — mobile, tablet, or PC, via web or app

Topics :UP global investors' summitUttar PradeshBanks

Next Story