In Kerala, KSEB is the sole organisation to supply the power to different categories of the consumers.KSEB works with a least cost methodology like An increase in the Sale of Energy; Effecting disconnection/dismantling and Revenue Recovery Action against defaulters for improving revenue realization; Reducing the commercial losses by replacement of faulty and sluggish meters by electronic meters; Conducting special revenue recovery adalaths at the level of distribution circles; One time settlement option to settle long pending HT/EHT dues; Tapping the non-Tariff income sources; Intensification of anti power theft activities; Prudent planning of generation so as to get maximum advantage of UI and sale of power to other utilities at competitive rates.
There are 24 Hydel Projects owned by KSEB and two by private agencies. The Wind Farm located at Kanjikkode with an installed capacity of 2.025 MW is the only one utilising the non-conventional energy source. The Brahmapuram and Kozhikode Diesel Power Plants with an installed capacity of 106.6 MW and 128 MW uses LSHS as fuel and are owned by KSEB. The Kerala State Electricity Board has an installed capacity of 2087.23 MW on its own with another 570.016 MW contributed by NTPC and Private Sector producers taking the total installed capacity of State to 2657.24 MW.
The other plants that are catering to the energy demands of the state are the Kayamkulam plant of NTPC with an installed capacity of 359.58 MW and the BSES, Kochi Plant with an installed capacity of 157.00 MW. The 20.44 MW plant of KPCL, Kasaragod is the latest entrant in the IPP segment of generation. The balance is met through import of power from the Central Sector.
KSEB has a major role in generation and distribution of power in adequate amount. As per section 172(a) of the Electricity Act 2003, KSEB has been continuing as the State Transmission Utility (STU) and Distribution Licensee. KSEB aims at providing electricity for all at affordable price and meet the future demand during the Eleventh Plan period by developing Hydro Electric projects in the State and ensuring share from upcoming interstate projects. Integrated functioning of all the key sectors viz. Generation, Transmission and Distribution is imperative in this background.
Energy Source in Kerala as on 31.03.2007
Many of the schemes initiated by KSEB, such as Kuttiar Diversion Scheme (37 MU), Kuttiadi Tail Race Scheme (3.75 MW), Kuttiadi Additional Extension Scheme (100 MW), Neriamangalam Extension Scheme (25 MW) are progressing, these are expected to be commissioned in 2007 – 08 itself.
Projects in the pipeline
Due to the high price of Naphtha & LSHS, KSEB has not been able to schedule full generation of energy from BSES Kochi, KPCL Kasaragode and NTPC Kayamkulam and from the KSEB'S own power stations BDPP and KDPP. However, considering the increase in peak load requirements and also for system reliability, the KSEB proposes to operate 40 MW from BDPP and 60 MW from KDPP during peak hours in 2007 – 08.
Power Sector Reforms
The board has introduced a number of consumer satisfactory systems like Trouble cell management system and mobile service units to restore the uninterrupted power supplies in the major cities in Kerala; Distribution Automation Project; Computerisation of Billing and Revenue Collection; Simplification of procedure for service connection; Additional Service Connections to 5 lakh consumers every year; Revenue Gap Reduction; Anti Power Theft Squad (APTS) and Prudent Power management initiatives.
7.23 Transmission network in Kerala is connected to the Southern Region Transmission System through two 400KV double circuit lines at Madakkathara and Trivandrum. There are five major inter state transmission lines. The major substations include one 400 KV. Substation and fourteen 220 KV substations and four 220 KV substations under construction. The main grid comprises of the 220 KV system. The present peak load demand is increased up to 2800MW.
Transmission Infrastructure 2006 – 07
In the power sector electrifying all households is a national target. At present 66.79 lakhs households in Kerala are electrified. Roughly around 10-11 lakhs households, mostly in the rural areas remain to be electrified in Kerala. The RGGVY Scheme launched by Government of India is expected to cover a large portion of these areas.
The distribution system is being modernised by computerisation of different activities in the sector. Computerisation work of billing and revenue collection in all section offices is in progress.
Targets and Achievements of distribution infrastructure during 2006 – 07
Source : KSEB
KSEB has undertaken various developmental activities in the distribution sector. In respect of MPLADS and SDF for MLA's, total 1074 and 3143 works were carried out. Under the peoples plan campaign, 38887 works were completed till 31.8.2007.
1) Accelerated Power Development and Reforms Programme (APDRP)
APDRP, a major initiative to bring about reforms in power distribution, has been initiated by the Ministry of Power, Government of India, for restoring the commercial viability of the distribution sector. In addition to town scheme, KSEB is also implementing city scheme. Three special schemes for the cities of Trivandrum, Kochi and Kozhikode with total outlay of Rs. 304 crores have been sanctioned. The major works include construction of 11 KV lines (underground cables), installation of distribution transformers, construction of substations, Distribution Automation, SCADA, TCMS, GIS mapping etc and they are proposed to be completed by 31.10.2008.
2)Rajiv Gandhi Grameen Vidyuthikarn Yojana (RGGVY)
RGGVY is a new programme of the Government of India for providing access of electricity to all households within five years, which is one of the goals of National Common Minimum Programme (NCMP).
LNG Terminal at Kochi
The LNG terminal is a part of the newly created port based Special Economic Zone (SEZ) at Kochi and Petronet LNG Ltd (PLL) is one of the co – developers of the SEZ. The LNG receiving re-gasification terminal at Kochi would satisfy the enormous demand of natural gas for power, fertilizers, petro – chemical and various other industries in Southern States. The terminal is designed to handle a capacity of 5 Million Metric Tones Per Annum (MMTPA) of LNG. However initially re-gasification facilities shall be installed for 2.5 MMTPA of LNG. Cochin Port Trust has allocated 32 hectares ofland at Puthuvypeen island for development of the LNG terminal which includes construction of jetty, storage and re gasification facilities - including two unloading arms, two full LNG tanks, vaporization system, utilities and off – site facilities.
Summary of Aggregate Revenue Requirement (ARR) 2007 – 08
figure while filing ARR for 2007-08
Potential Sites for Wind Power Generation in Kerala
State Electricity Regulatory Commission (KSERC)
District wise Actual and Normal Rainfall (mm) with Percentage Departure from Normal rainfall for 2007
In Kerala, out of a cumulative expenditure of Rs. 4043.02 crores, Rs. 2876.11 crores (71%) is invested for major and medium irrigation. About 60 to 70 percent of the investment in each plan was made for this purpose. Rice is the major crop benefited through irrigation infrastructure. During the Tenth Plan period an outlay of Rs. 930 crore was set apart for the Irrigation sector which includes Rs. 600 crores for Major and Medium Irrigation, Rs. 205 crores for Minor Irrigation and Rs. 50 crores for Flood Control and Anti-sea Erosion works. This is against the outlay of Rs. 1028.00 crores and an expenditure of Rs. 1078.73 crores during the Ninth Plan period. In the allocation of resources during Tenth Plan a small reduction was noted in the overall outlay of the sector. The percentage share of Plan outlay during Tenth Plan was 3.88% against that of 6.38% in the Ninth Plan. The reduction was mainly due to the transfer of Minor irrigation schemes to the local bodies and reduction in number of major projects.
During the Plan period (2002-07) against the Plan outlay of Rs. 930 crores, an amount of Rs. 781.39 crores was budgeted and the expenditure came to Rs. 876.56 crores. A major portion (73%) of the outlay on Water Resource Sector was budgeted for Major and Medium Irrigation Sector and the expenditure recorded for Major & Medium for the Tenth Plan was 78% of the total expenditure. Over and above the State plan outlay a substantial amount has been invested for Minor irrigation and Flood Management from the schemes of Local Self Governments. The major works implemented under surface water are minor irrigation Class – I, II and Lift irrigation schemes. Construction of check dams, Vented cross bars, weirs, tanks etc are the various works executed under minor irrigation Class-I & II. An amount of Rs. 119.50 crores have been expended for implementing minor irrigation schemes during the Tenth Plan period.
Kerala state which had a low base in food production is facing serious challenges in retaining agricultural area. Kerala agricultural economy is undergoing structural transformation from the mid seventies by switching over a large proportion of its traditional crop area which was devoted to subsistence crops like rice and tapioca to more remunerative crops like coconut and rubber. The provisional estimate for 2005-06 indicated an increase of 6.72 per cent in growth. The quick estimate for 2006-07 showed an increase of 6.17 per cent over the previous year.The trends in agricultural income in Kerala during the last seven years is given below.
Growth of Agricultural Income in Kerala (1999-00 Prices)
Directorate of Economics and Statistics
Area Production and Productivity for 2006-07
Production and Productivity for 2006-07 are provisional except Paddy,
Cardamom, Coffee, Tea and Rubber
The Eleventh Five Year Plan of the state and the country was launched in 2007-08 with a special focus to address the agrarian crisis.The National Policy for farmers was released in 2007 with the major objectives such as to improve economic viability of farming by substantially increasing the net income, to protect and improve land, water, bio-diversity and genetic resources essential for sustained increase in the productivity, profitability and stability of major farming systems.
1. National Policy for Farmers -2007
* Joint pattas for both homestead and agricultural land are essential for empowering women to access credit and other services. The Land Acquisition Act would be reviewed with particular reference to the assessment of compensation.
* Water users’ associations would be encouraged to gain expertise in maximising the benefits from the available water. To enhance water availability and stability of water supply , rain water harvesting and aquifer recharging will be given priority. Renovation of existing ponds and wells, demand management through improved irrigation practices ,launching water literacy movement etc. will be initiated
* With the support of National Rainfed Area Authority, a drought code will be introduced in drought prone areas, Flood code in flood prone areas and Good weather code in arid areas
* To enhance the income of livestock owners, agri-clinics operated by veterinary and farm science graduates would be encouraged to improve productivity and overall efficiency of livestock. Livestock insurance would also be revamped and made accessible to all farmers.
* For poultry Quarantine and Testing facilities for imported birds and vaccines at all ports of entry would be established and strengthened. Testing for safety and efficacy of imported poultry vaccines before they are allowed to be marketed, as is done in the case of human vaccines, would be made compulsory. Appropriate support would be provided to backyard poultry farmers to promote clusters or small holders’ poultry estates.
* In the area of public policy, there is a need for well-planned aquarian reforms in order to provide landless labour families access to village ponds and other water bodies in the public domain for aquaculture. Centralised services to support the decentralised capture and culture in fisheries sectors, promoting inland aquaculture, Artificial coral reefs to compensate for the loss of natural coral reefs to revive the fish catch, Raising bio-shields etc. will be initiated
* A dynamic policy for the management and economic use of the Exclusive Economic Zone (EEZ) for a variety of economic activities, including fisheries, will be evolved and put in place with the assistance of NFDB.
* The National Gene and Biodiversity Fund would be used to recognise and reward contributions of farmers and to support revitalisation of in situ farm conservation traditions of such communities.§ For conservation of bio resources , community biodiversity registers, support to rural and tribal people for revitalizing their farm traditions, participatory breeding procedures, launch of literacy movement on genetic and legal aspects of biodiversity, genome clubs in schools and colleges, training of farm and tribal families to prevent gene erosion, organise and support herbal bio valleys to conserve medicinal plants , setting up of farmer level gene banks, participatory management of national parks, biosphere reserves and gene sanctuaries etc. will be promoted
* Biodiversity fund will be utilized for motivating people to conserve their animal breeds under Biodiversity act.
* New technologies will be applied to launch an evergreen revolution .The research strategy should be pronature, pro-small farmer and gender sensitive. Community-managed seed villages and seed technology training centres are needed, with women playing the major role because of their traditional knowledge of seeds and seed management, especially in tribal communities.
* A National Bio-technology Regulatory Authority would be set up for ensuring the safe and responsible use of recombinant DNA technology or genetic engineering. Need-based breeding of crop varieties would be stepped up such as processing quality in fruits and vegetables.
* High level multidisciplinary effort will be made for enhancing scientific inputs in organic farming that meet the needs of farmers.
*Establishing an integrated National Agricultural Biosecurity System (NABS) on cropping patterns and water availability.
* The agro-meteorological advisories issued from time to time would be used by Panchayat-level functionaries, trained to give appropriate land-use suggestions to farmers with the least possible time lag. For marine fisheries, data on wave heights and location of fish shoals available would be transmitted to the fishermen. In drought and flood-prone areas, experienced farmers would be trained as “Climate Managers” in the art of managing drought, flood and aberrant monsoons.
* A national seed grid will be established to ensure supply of seeds across the country, as per the area specific requirement.
* Steps would be taken to ensure that each farmer is issued with a soil health passbook containing integrated information on the physics, chemistry and microbiology of farm soils with corresponding advisories would be promoted.
* The sale of spurious and substandard pesticides would be prevented and bio-pesticides would be promoted.
*Agri - entrepreneurs including farm graduates and progressive farmers would be encouraged to provide implements and tools, machinery, tractors and other farm implements on a custom-hire basis.
* Bio-technology research in the area of vaccine development would be stepped up, encouraging public private partnerships
* Progressive fishermen and their groups such as SHGs would be trained in induced fish seed breeding, production and availability of seed and fish seed feed.
* For capacity building and livelihood, women working in the farms need appropriate support services like crèches, child care centres, nutrition, health and training, etc.
* Steps would be taken for extensive coverage of farmers under the Kisan Credit Card Scheme. Micro credit and micro insurance will be promoted. Revamping the National Agricultural Insurance Scheme to make it more farmer friendly. For credit and insurance literacy in villages, Gyan Chaupals (village knowledge centres) will be established . Kisan credit cards would be issued to women speedily with joint pattas for homestead / agricultural land.
* KVKs would take up training and lab-to-land demonstrations in the area of post-harvest technology, agro-processing and value addition to provide skilled jobs in villages.
* Terminal markets for agriculture would be developed in public-private partnership mode
* The Minimum Support Price (MSP) mechanism would be implemented effectively across the country and the Market Intervention Scheme (MIS) would be strengthened markets for local produce.
* The curriculum of Agricultural Universities will be revised. The motto of Agricultural universities would be to groom “every scholar/student as an entrepreneur”. This will call for integrating business management principles with major applied courses.
* The mandate of the ICAR would be expanded to provide for registration and accreditation to the farm graduates as registered farm practitioners to provide quality service to the farmers.* Special categories of farmers such as tribal farmers pastoralists, island farmers, plantation farmers and urban farmers will be supported* Special categories of farming such as organic farming, green agriculture, protected agriculture would be promoted .
* Risks and benefits associated with GM crops will be assessed.
*Distress spots will be addressed to mitigate the agrarian stress and mega biodiversity hot spots will be encouraged to convert their bio resources into economic wealth in a sustainable manner with the participation of local communities .
* Educated youths would be helped and supported for setting up agri-clinics and production-cum-processing centres to undertake outsourcing jobs
2. National Food Security Mission (NFSM)
In order to tackle this food crisis the Govt. of India launched the National Food Security Mission in 2007- 08 to increase the production of rice by 10 million tons, wheat by 8 million tons and pulses by 2 million tons by the end of the Eleventh Plan (2011-12). Palakkad district from Kerala has been included in the mission. The key features of NFSM is that the scheme to be implemented in a mission mode through a farmer centric approach and all
the Stakeholders to be actively associated at the District levels for achieving the set goal. The scheme aims to target the select districts by making available the improved technologies to the farmers through a series of planned interventions. A close monitoring mechanism is proposed to ensure that interventions reach to the targeted beneficiaries. The major objectives of the scheme are increasing production of rice, wheat and pulses through area expansion and productivity enhancement in a sustainable manner; restoring soil fertility and productivity at individual farm level; and enhancing farm level economy (i.e. farm profits) to restore confidence of farmers of targeted districts. The Districts are selected based on following criteria
*National Food Security Mission-Rice : Districts Covering more than 50,000 ha area under rice , the productivity is less than the State average productivity.* National Food Security Mission-Wheat : Districts with sizeable area under wheat , Districts having irrigation to a great extent, the productivity is less than national/state average.*National Food Security Mission- Pulses : The districts selected based on potential for area expansion through inter-cropping / fallow land.
A no. of 133 Districts in 12 states have been selected under NFSM- Rice , 138 Districts in 9 states under NFSM-Wheat and 168 Districts in 14 states have been chosen under NSFM - pulses.
Strategies adopted under the mission are
1. Expansion of area of Pulses and Wheat, no expansion of area in rice
2. Bridging the yield gap between the potential and the present level of productivity through Ø Acceleration of seed production.
* Integrated Nutrient Management and Integrated Pest Management
* Promotion of new production technologies like hybrid rice, timely planting of wheat and promotion of new improved variety of Pulses
*Supply of inputs ensuring their timely availability
*Farmers Training and Visits
Source : Ministry of Agriculture and Co operation, GOI, 2007
There are considerable variations in forest type, the predominant three broad types being tropical moist deciduous forests from the plains to 750 MSL, tropical wet evergreen forests in the mountain ranges of the Ghats, and tropical semi-evergreen forests between these two types. These three types together cover most of the natural forest area (79 per cent). The coverage of the plantation forestry is to the extent of 19.30 per cent of the total area. The forests in Kerala are better stocked than forests in most other parts of India.
Types of Forests in Kerala
Source: Department of Forest
The Revenue from the forestry sector by way of sale of timber and other forest products comes to Rs. 175 crores in 2006-07 as against Rs. 190 crores in 2005-06. Major portion of the forest revenue is from timber (Fig. 6.1). During 2006-07, Rs. 139.14 crore was the revenue from timber, which account for 79.51 per cent of the total forest revenue. The State Government have modified the policy of supplying raw materials at subsidised rates from 1999-00 onwards and completely abolished the subsidy with effect from 30.09.2004. The increase in revenue attained through this measure is of the order of Rs. 10.00 crore per annum.
National Forest Policy
of Kerala have been managed following National Forest Policy. The
National Forestry Commission has also recently recommended that each
State shall have it own forest policy statement for the sustainable
management of its forest and wild life resources. A comprehensive
state forest policy to address the specific problems and issues related
to the conservation of forests and biodiversity of the state as well
as the livelihood needs of the forest development communities has
been formulated during 2007. The forest policy of the stateis guided
by the 1988 National Forest Policy. The Forest Management Policy of
the state encompasses technology improvement, bio-diversity conservation
and development of partnership with the forest dependent communities
and fringe dwellers. Special thrust is also given for protecting species
of plants and animals.
In Kerala 571 PFM Committees have been formed and 1.65 lakh ha. forest area has been brought under PFM. About 64000 families including 9823 SC's and 11279 ST's are involved in PFM programme in various forest divisions of Kerala. The execution, monitoring and evaluation of the micro plans are vested with the Vanasamrakshana samithies. So far 561 VSSs and 193 EDCs are formed during the last 5 year period. Government of Kerala constituted the FDA's in each forest division in 2002-03, with a view to guiding the activities of the VSS.
National Afforestation Programme The amount released to State was Rs. 10.55 crores and the expenditure reported was Rs. 6.05 crore. The project is being implemented by 24 Forest Development Agencies through Participatory Forest Management (PFM) mode with the active participation of stake holders forming Vana Samrakshana Samithies (VSSs).
Wildlife and Biosphere Reserve
Kerala has two bio-sphere reserves namely Nilagiri Bio-sphere Reserve with an area of 1455 sq.kms constituted in 1986 and Agasthyamala biosphere reserve with an area of 1701 sq.kms constituted in 2002 .Detailed action plans will facilitate attraction of additional funding for these sites for long term conservation and sustainable utlisation of resources.The area covered by five National Parks, fifteen Wild life sanctuaries coming under the category of protected areas in Kerala works out to 2452.48 sq.kms. It is about 21.75 per cent of the total area under forest and 6.3 per cent of the total geographical area, which is higher than the national average of 5 per cent. Details are given in Appendix-6.20. During 2006, Kurinjimala- sanctuary was constituted and a fowl sanctuary named choolannur pea fowl sanctuary has established in 2007. With the formation of these sanctuaries, Government intended to ensure long term protection for the majestic vegetal sketch which contains many botanical rarities and novelties to science. Protected areas are managed now as showcases of bio diversity with predominance for large animals in habitat management, participatory management based on the principles of eco-development has been initiated and this strategy has resulted in the co-operation of the neighborhood communities and forest dependent communities. During the year 2006-07, an amount of Rs. 1790 lakhs was earmarked under various schemes for protected areas management including bio diversity conservation. Out of which Rs. 1469.62 lakhs were utilised under various schemes including biodiversity conservation and eco – development.
Sanctuaries, National Parks, Biosphere Reserves and other Protected Areas in Kerala
The Department of Mining & Geology has taken up investigation programmes of urgent nature for the benefit of the mineral based industries in the State and for the general public as per the directions of the Government from time to time. Based on the results of the reconnaissance and preliminary geological surveys including pitting and trenching, the Department takes up detailed exploration such as drilling, sampling and preparation of contour map after conducting contour survey samples collected during the investigation, are being analysed in the laboratories which include china clay, silica sand, graphite, bauxite, limestone, lime shell, stream sediments rock samples etc.
Investigation for China clay had been conducted in Thiruvananthapuram, Kollam and Kasaragod districts during 2006-07. The Department had prepared a database on 1193 minor mineral quarries and 102 crusher units through a survey covering 104 villages in Kollam, Kottarakara, Pathanapuram, Karunagapally and Kunnathoor taluks of Kollam district and Thiruvananthapuram, Neyyattinkara and Nedumangad taluks of Thiruvananthapuram district.Assessment of availability of river sand in Kulathupuzha River was done during 2006-07. During the year 2006-07 the Department collected revenue of Rs.2646.83 lakh.
Revenue Collection of Mining & Geology Department (2006-2007)
The Department implements the provision of the Mines and Minerals Act 1957 and the Rules. Mineral concessions for miner minerals are sanctioned as per the Kerala Concessions Rules 1967. The various mineral concessions in force as on 31.3.2007 are: Prospecting Licenses-Major Minerals(15) and Minor Minerals(15); Mining Lease-Major Minerals (83); Reconnaissance permit-Major Minerals(1) and Minor Minerals(771); Quarrying Permit-Minor Minerals (2917); Quarrying Lease-Minor Minerals (361) and Registered Metal Crusher- Minor Minerals (83).
Kerala is ready to become a total banking state. Total banking state means every house hold in the state would have at least one bank account and would be eligible for a general purpose loan up to Rs.25000. The SLBC committee works with an action plan to attain the target within the limited time frame. A wide variety of financial institutions exist in Kerala. Financial stability measures were initiated since early 1990s to strengthen the commercial banks and has emerged stronger over the years. Very popular challenges that have faced by the commercial banks are declining interest rate and reduced lending margins. Impact of globalisation made Kerala’s financial markets to integrate with the global financial markets. As such the volatality in the latter makes its impact on our domestic financial market, even found in the crisis movements in the SENSEX. The expansion of mutual funds influenced the domestic banking system some extent.
The disbursement of credit by NABARD in Kerala during 2006-07 was Rs. 517.12 crore including the disbursement towards KSCARDB. NABARD has disbursed an amount of Rs.8795.02 crore at all India level against Rs.8622.37 crore during 2005-06.
State wise Financial Assistance Disbursed by NABARD during 2006-07 ( Amount Rs. lakh)
Annual Reports of NABARD 2006-07
State wise Cumulative Financial Assistance Disbursed by NABARD as at the end of March 2007( Amount Rs. lakh)
At the end of March 2007, the total number of commercial bank branches in Kerala was 3673. Of this 321 are rural branches, 2478 are semi- urban branches and 874 are urban branches. Out of the total commercial banks in the state, public sector banks account for 67.25% of the branch net work in the state.
by Scheduled Commercial Banks
As per State Level Bankers Committee (SLBC) statistics 2007, the total advances disbursed by banks in Kerala as on March 2007 is Rs.68297 crore as against Rs.55314 crore of 2005-06 which shows an increase of Rs.12983 crore. The State Bank group disbursed an amount of Rs.20737 crore (30.36%) and private sector banks disbursed Rs.21351 crore (31.26%) including IDBI bank which is the highest share in the total advance outstanding in the state. The share of nationalised banks in the total advance is Rs.19013 crore (27.8%) and that of co-operative banks is Rs.4024 crore (5.9%).
by Public Sector Banks
Growth of Bank Deposit
As per RBI statistics, the total deposits by all scheduled commercial banks at all India level in March 2007 is Rs.2598823 crore showing an increase of Rs.505781 crore from the last year. The corresponding figures with respect to Kerala during March 2007 is Rs.95282 crore with an increase of Rs.15617 crore. Aggregate deposits of scheduled commercial banks grew by 24.6% in 2006-07 as compared with 17.8% of last year. Maharashtra is far ahead among the states by mobilizing the largest amount of deposit of Rs.655402 crore (25.2%) in 2007 and Rs.489794 crore (23.4%) in 2006. Uttarpradesh to second with Rs.181006 crore in March 2007 against Rs.151462 crore in March 2006. The Reserve Bank of India's reports on Trend and Progress of Banking in India 2006-07, states that Indian Commercial Banking system has achieved remarkable soundness, dynamism and resilience. And that there is also a convergence in the levels of soundness of public sector banks and new private banks. However the RBI claim that the indicators of soundness for Indian banks compare well with international standards is not convincing.
According to SLBC (Kerala) report, the total bank deposit in Kerala increased and reached Rs.94510 crore in March 2007 with an annual growth rate of 21.07%. The total deposit in March 2006 was Rs.77677 crore. That is an increase of Rs.16833 crore. This shows that state has poised for a higher growth rate in total deposit during 2006-07. The NRE deposits in Kerala increased to Rs.33304 crore as at March 2007. As compared to March 2006 the NRE deposits increased by Rs.2633 crore for the fiscal 2006-07, showing a growth of 8.58%. State Bank group holds the highest share of Rs.12509 crore (37.56%) in the NRE deposits followed by private sector bank with Rs.10599 crore (31.83%) and nationalised banks with Rs.9695 crore (29.11%). The domestic deposit is also gradually increasing in the state. The domestic deposit which was Rs.47006 crore in March 2006, grown by 24.22% and reached Rs.58393 crore in March 2007.
The NRE deposits constitute 36.32% of the total deposits of commercial banks in the state. There was a growth of Rs.2633 crore in NRE deposits from Rs.30671 crore in 2006 to Rs.33304 crore in 2007 in the state. Commercial banks of semi urban areas holds 69.61% of NRE deposits while urban areas accounted for 23.54% and rural areas 6.85%. Growth of bank deposits in Kerala from 1988 to 2007 are given below.
Growth of Bank Deposit in Kerala 1988 to 2007
Source: SLBC, Kerala
As per RBI statistics, the credit-deposit ratio of all scheduled commercial banks as on March 2007 stood at 75 percent which was 72.5 percent during March 2006. The CD ratio at the end of March 2007 in the states of Tamil Nadu, Maharashtra, Andhra Pradesh, Karnataka and Rajasthan were higher than the all India level. As on March 2007 the highest CD ratio was observed in Tamil Nadu (112.3%) followed by Maharashtra (98%). At the bank group level the CD ratio was above the all India ratio in respect of foreign banks (87.5%), State Bank of India and its associates (78.2%) and was lower for other scheduled commercial banks (74.1%), Nationalised banks (73.5%) and Regional Rural Banks (58.7%). Considering the case of Kerala as on March 2007 the CD ratio is 63.6% which was 61.7% in March 2006. As per the RBI statistics on public sector banks alone, CD ratio at all India level is 74.31% in March 2007 against 70.58% in March 2006. Here also Tamil Nadu stands first with 108.15% in March 2007 against 102.44% in March 2006. Maharashtra is just behind with 100.27%. The CD ratio of Kerala is 68.02 in March 2007 against 65.7 in March 2006.
On analysing the SLBC report, it can be seen that CD ratio in the commercial banking sector of the state has increased by 3.25% points during the financial year to reach 70.09% in March 2007. When the CD ratio of major commercial banks operating in Kerala are compared, the Bank of India stands first with 103.95% and Syndicate Bank comes 2nd with a CD ratio of 78.03% in March 2007. The performance of other banks are Central Bank of India 73.47%, Union Bank of India 73.08%, State Bank of Travancore 68.65%, State Bank of India 68.4% and so on. CD ratios of selected major banks operating in Kerala from 1992 to 2007 are furnished in Table 17.6.
Credit Deposit Ratios of Selected Major Banks operating in Kerala (as on March 2007)
The District wise details of banking statistics in Kerala, shows that the largest number of bank branches are in Ernakulam (544 Nos.), followed by Thrissur (417 Nos.), and Thiruvananthapuram (383 Nos.). Ernakulam district continued to stand first in mobilisation of deposits and disbursement of advances with Rs.21852 crore and Rs.15891 crore respectively. Wayanad stands last with Rs.579 crore as deposits and Rs. 907 crore as advances. In the case of C.D. ratio Wayanad stands first with 156.6% and Idukki stands second with 128.5%. Pathanamthitta stands last with C.D ratio of 30%. C.D. ratio of Kozhikode is 84.3%, Kasaragode 79.7%, and Ernakulam 72.7%.
Financial inclusion refers to delivery of banking services at an affordable cost to the vast sections of disadvantaged and low-income groups who tend to be excluded from the formal banking channel.
Zero Balance or No-Frills Accounts
of zero balance or no-frills accounts has enabled the common person
to open bank account providing banking facilities closer to the customer,
especially in remote and unbanked areas, which keeping transaction
costs low, remains a challenge. The convener banks of SLBC were advised
to identify at least one district in each state for achieving 100%
financial inclusion by providing 'no-frills' account and issue of
general purpose credit card. So far, 160 districts have been identified
100% financial inclusion has been achieved in 28 districts in eight
states which includes Kerala also. All districts of Himachal Pradesh
have achieved financial inclusion. In view of the special thrust on
financial inclusion, co-operative banking has acquired renewed significance
in the Indian Financial System.
During 2006-07, banks in Kerala issued an amount of Rs.12564.33 crore to 504405 beneficiaries as housing loan, corresponding figures for 2005-06 are 10073.83 crore to 473442 beneficiaries. During 2006-07, finance through direct housing was Rs. 12475.31 crore and that through indirect housing was Rs.89.01 crore. State Bank of Travancore alone issued Rs.2559.3 crore to 93474 beneficiaries, SBI disbursed Rs.2196.01 crore to 52640 beneficiaries. Among the Nationalised banks Canara Bank stands first with Rs.1008.9 crore to 31180 beneficiaries, Union Bank of India goes to second place with Rs.720 crore to 23996 beneficiaries. Federal Bank issued Rs.1312.53 crore to 42169 beneficiaries, South Indian Bank disbursed Rs.277.29 crore to 9226 beneficiaries.
As at the end of March 2007, Banking sector in Kerala disbursed an amount of Rs.1836.29 crore to 145947 beneficiaries as Educational Loans. State Bank group disbursed Rs.889.01 crore to 69173 beneficiaries, Nationalised bank group disbursed Rs.754.8 crore to 59470 beneficiaries, RRB's disbursed Rs.39.82 crore to 5309 beneficiaries and private sector bank group disbursed Rs.143.95 crore to 11126 beneficiaries. Here also State Bank of Travancore issued Rs.698 crore to 59958 beneficiaries, Canara Bank disbursed Rs.276.57 crore to 22439 beneficiaries and Federal Bank disbursed Rs.96.91 crore to 7525 beneficiaries.
Advances to Weaker Section and SC/ST
During 2006-07 an amount of Rs.9255.68 crore has been disbursed to 2750797 beneficiaries of weaker sections in the state in which Rs.978.29 crore was to 350934 SC/ST beneficiaries. The corresponding advances during 2005-06 were Rs.7221.57 crore and Rs.734.53 crore respectively. Weaker sections advances grew by Rs.2034 crore during the last fiscal and year to year increase as at March 2007 was 28.17%.
With a view to developing a supplementary credit delivery systems that is cost effective and user friendly for both banks and the poor, micro finance initiatives encouraged in India. These initiatives have been centered around two models (1) the SHG Bank Linkage Programme and (2) the Micro Finance Institutions.
Linkage Programme launched by NABARD in 1992 continued to be the predominant
Micro-Finance model in the country. According to SLBC report during
2006-07 about 1.69 lakh SHGs have been linked in the state under the
SHG bank linkage programme of which 1.36 lakh SHG's are exclusive
women SHG's (80.93%). During the year 2006-07, 686408 new SHGs were
credit linked with banks at all India level as against 620109 during
2005-06. At all India level the cumulative number of SHGs, credit
linked with banks up to March 2007 was 2.92 million. As
per RBI statistics during 2006-07, 4.57 existing SHG's received repeat
finance as against 3.45 SHGs in the previous year. The total bank
loan disbursed to SHG's during 2006-07 was Rs.6643.19 crore as against
Rs.4499 crore during the previous year. The cumulative bank loan disbursed
to SHGs up to March 2007 was Rs.18041 crore. As on March 2007 about
1.75 lakh SHGs maintain savings account having Rs.97.27 crore with
commercial banks. The state bank group which disbursed Rs.44.75 crore
to 81689 SHGs comes first in the state. About 81.12% of the SHGs are
exclusive women SHGs.
There are other financial institutions to provide financial support to respective private and public sector under takings in various sectors. These institutions constitute a group of professionals from various fields including engineering, management, finance, and law.
1. Kerala Transport Development Finance Corporation Ltd. (KTDFC)
KTDFC, a Kerala Government owned Non Banking Financial Company registered under the Reserve Bank of India, offers vehicle loan packages to both individuals and transport operators ranging from two wheelers to heavy commercial vehicles with low diminishing EMI rates, hassle free procedures and premature closure options which in turn ensure more savings to the customers. KTDFC accepts deposits from the public. These deposits, guaranteed by the Government of Kerala, ensure 100% security and extra earnings.
2. Kerala Finacial Corporation (KFC)
KFC covers schemes like Term Loans, Working Capital finance and Short Term apart from schemes focused at the weaker sections of the society extending equity type assistance (National Equity Fund). Modified revolving Fund, Modernisation schemes for SSIS, tourist homes and hospitals,TV serial production are innovative schemes introduced to suit changing customer requirements. The Corporation also plays a major role in the development and industrialisation of Kerala by extending financial assistance to suit the requirementsof the enterpreneurs.
3. Kerala State Industrial Development Corporation Ltd. (KSIDC)
State's one and only agency for industrial development and promotion
fully owned by the Government of Kerala, is a nodal agency for foreign
and domestic investments in Kerala. The agency provides comprehensive
support for investors. Also the agency advises the state government
on key facets of the state’s industrial policy and organises
promotional campaigns both in India and abroad.
Kerala SIDCO, a Public Sector Undertaking of the Government of Kerala, acts as a Promotional Agency for Small Scale Industries. This Corporation is rendering assistance to SSIs in the State through providing infrastructure facilities, distribution of essential raw materials, marketing of the SSI products, undertaking civil and electrical works etc. Kerala SIDCO also supplies Bitumen to Local Bodies as Nodal Agency and Paraffin Wax to small scale industries.