Non-Food Credit Jumps By Rs 9396 Crore

Non-food credit offtake from scheduled commercial banks (SCBs) has increased by Rs 9,396 crore in the fortnight ended December 28, 2001, against a decline of Rs 384 crore in the preceding fortnight ended December 14, 2001.

Economists attribute the increase in non-food credit more to the government raising resources for mobilising armed forces to the Indo-Pak border (this expenditure has not been accounted for in the 2001-02 budget and hence becomes a contingent liability) in the wake of the tough stand taken by India on cross-border terrorism and Kashmir, than due to actual pick up by the trade and industry.

 

In the financial year (April 1 to December 28, 2001) so far, non-food credit, which is the prime indicator of economic activity, has seen an offtake of only Rs 34,880 crore compared with Rs 49,986 crore in the corresponding period in the previous fiscal.

As on December 28, 2001, the outstanding non-food credit of SCBs stood at Rs 5,06,323 crore.

Food credit in the reporting fortnight has increased by Rs 513 crore against an increase of Rs 34 crore in the preceding fortnight. As on December 28, 2001, the outstanding food credit of SCBs stood at Rs 52,276 crore.

Investments by SCBs in government securities declined by Rs 944 crore in the reporting fortnight compared with an increase of Rs 7,664 crore in the previous fortnight. In the financial year so far, investment in gilts by SCBs was higher at Rs 58,381 crore against Rs 47,176 crore in the corresponding period in 2000-01.

Outstanding investments by SCBs in government securities as on December 28, 2001, stood at Rs 3,98,415 crore.

Aggregate deposits of SCBs have increased by Rs 5,079 crore in the reporting fortnight as against an increase of Rs 647 crore in the previous fortnight. Outstanding deposits of SCBs as on December 28, 2001, touched Rs 10,67,707 crore.

Meanwhile, foreign exchange reserves of India saw an accretion of $254 million in the week ended January 4, 2002. Forex reserves stood at $48.299 billion as on January 4. The reserves recorded a $33 million jump in the week ended December 28 over the preceding week.

The increase in forex reserves was solely on account of the foreign currency assets (FCA) increasing by $260 million. The FCA stood at $45.438 billion as on January 4. Gold reserves declined by six million to $2.856 billion, while special drawing rights remained static at $5 million.