PM's Rozgar Yojana to be finetuned

To stimulate employment generation, the government is set to rework the Prime Minister's Rozgar Yojana (PMRY) and push banks to increase the credit flow under the scheme.

To finetune the scheme, BS Minhas, secretary, small-scale industries and agro and rural industries, convened a meeting here today of bank chiefs and state government officials.

Bankers, who attended the meeting, said the government was trying to work out ways to improve credit delivery and create a conducive environment for banks to lend through the scheme.

Over 2.5 million jobs have been created under the scheme so far. The target for the current fiscal has been set at 330,000 jobs and assistance to set up 220,000 units. The outgo under the PMRY was estimated at Rs 170 crore during 2003-04 as against Rs 180 crore in 2002-03.

The Centre asked states to improve the processing of applications to weed out potentially unviable units, which would encourage banks to lend through the scheme, said an official.

The functioning of district industry centres should be streamlined for better assessment of the minimum project cost so that units did not face the problem of abundance or shortage of funds, bankers said. They also advised states against the bunching of applications in the last quarter of the financial year.

Banks expressed concern over recovery. While most states had public recovery laws, the recovery officer was ambiguous and in most occasions the district magistrates were given the task, bankers said.

"District magistrates are more worried about law and order and have little time for the recovery of dues," said a banker.

The Andhra Pradesh example of designating naib tehsildars as the recovery officer found favour with most banks. Some banks also proposed the use of Credit Guarantee Fund to increase the comfort level while sanctioning projects and push funds to increase employment.

The PMRY is a scheme to provide self-employment to those educated up to class VIII and assistance to units in operation sine October 1993. Under the scheme, credit is made available for setting up industrial or service sector units.