The year 2000 has been a landmark in the history of State Level Financial Institutions (SLFIs). Various historical decisions pertaining to their policy framework, working and operations have been taken by the GoI and RBI. Due to the continuous and sustained efforts by COSIDICI at various fora the much awaited amendments to the SFCs Act 1951 were cleared by the GoI on September 06, 2000. The most important amendments relating to widening and broad basing the definition of ‘industry’ enlarging the scope of activities of SFCs, removal of restrictions on the SFCs for mobilisation of resources from the market and enhancement of the limit upto which SFC can provide finance to an industrial concern to Rs. 5 crore and Rs. 2 crore are expected to have a positive impact on the functioning of SFCs. However, as 15 out of the 18 SFCs are facing financial instability due to various reasons they would be able to take advantage of the amendments only after recapitalisation and restructuring of their equity bases. This fact was stressed upon by COSIDICI and consequently a 9 Member High-Level Committee under the Chairmanship of Shri G.P. Gupta, CMD, IDBI was constituted by the GoI to look into the problems being faced by SFCs and suggest measures for strengthening and revitalising them.
SLFIs have been equipping themselves to meet the demands of the new economy. The year 2000 has seen these institutions empowering themselves by computerising their operations, offering online application and registration forms, updated account status to their borrowers on internet and funding of Information Technology (IT) venture funds etc. The old economy is thus being renewed by the power of information technology. COSIDICI further strengthened the SLFIs by launching a Website on April 07, 2000 containing comprehensive information regarding the promotional and developmental schemes of state corporations for setting up of industries. The Website also indicates state-wise investment opportunities and incentives available to the prospective entrepreneurs. It is a great tool to apprise potential investors about the various advantages of investing in the states.
The SLFIs started diversifying actively into the upcoming sectors like bio-technology and food processing during the year. They are performing their role as nodal agencies of the respective states to implement various welfare, promotional and developmental schemes. The crying need of the country is infrastructure. The SLFIs have taken on the onus of upgrading all kinds of infrastructural facilites and building new ones on themselves. They have thus geared themselves to play a pivotal role in the overall development of the country and are all set to help it face the challenges of the new century.
At the end of the century and the beginning of another ..... in actual fact the beginning of a new millennium ..... the SLFIs have made it possible for the benefits of globalisation and information technology to trickle down to the grass root levels and have thus been instrumental in bringing about social justice. It is expected that the amended SFCs Act and the recommendations of the High-Level Committee would further strengthen the SLFIs in helping them to fulfil the socio-ecoomic obligations of the Government.
And with this
I wish our readers a very Happy and Prosperous New Year.