Banks step up loans to autorickshaw owners for CNG conversion

With the West Bengal government now looking at putting the issue of conversion of two-stroke autorickshaws plying on the city streets to cleaner fuels on fast gear, the public sector banks led by United Bank of India(UBI) have already sanctioned loans to 200 vechicle owners of the 830 applications received so far.

The banks in the region had disbursed loans to around 122 autorickshaw owners looking at replacing their old two-stroke vehicles with the help of bank finance, informed officials in the priority sector lending section of the UBI.

"The state government had sent letters to PSU banks and now we are coordinating with the public vehicles department to expedite the process of disbursing loans to autorickshaw owners under the 'Model Scheme for replacement of existing autorickshaw of Kolkata Metropolitan Development Authority(KMDA) area.", informed K S Ramakrishnan, zonal manager, Andhra Bank. His bank has received around 150 applications.

The PSU banks are offering a loan of Rs 95,000 for a liquefied petroleum gas (LPG) vehicle priced at Rs1.26 lakh.

The state government would give a subsidy of Rs 5,000 and Bajaj Auto would chip in with a rebate of Rs 5,000 per autorickshaw, besides paying Rs 6,000 for an old two-stroke vehicle.

The autorickshaw owner would have to pay Rs 10,000 from his pocket.

Loans are offered at a 12.25 per cent interest rate for a 60 month period with a three months moratorium.

While the state government now planned to gear up vehicle conversion rates, it is unclear how it would achieve a full conversion in accordance with the Calcutta High Court (HC) order as a major portion of the vehicles did not have legal papers.

A substantial section of owners did not have legal papers allowing them access to bank loans.

The Bengal government had missed the target date of December 31, 2008, and was accused of dragging its feet on the implementation of the HC order directing a ban on two-stroke autorickshaws.

The illegal ownership structure of the autos could be the reason why the state was ducking the issue, sources here said.

While the autorickshaw unions were in favour of converting to cleaner fuels, nothing much could be done to help the large number of unregistered three-wheelers in the city. It is estimated that nearly 20,000 illegal autorickshaws plied on the city-roads together with an equal number of legal vehicles.

Centre of Indian Trade Unions (CITU) secretary Kali Ghosh laimed that the HC had not fixed a new deadline for conversion and it was the state government which had asked for time till July 31.