Seek Implementation Of Investment Insurance Scheme
SRINAGAR – Voicing serious concern over the modus operandi adopted by various banks for loan recovery, the Kashmir Chamber of Commerce and Industry Wednesday urged the government of India to put in place Conflict Insurance Scheme, later modified as Investment Insurance Scheme, to instill a sense of safety among entrepreneurs and businessmen.
We have come across press statements from different trade bodies as well as erstwhile trade leaders particularly who have supported the action of J&K Bank without keeping in view the problems faced by the different sectors of our economy, the KCC&I president, Abdul Hamid Punjabi, said in a statement, adding that in majority of cases in Kashmir, the default had been due to circumstances beyond businessmens control.
He said the absence of incentives like the Investment Insurance Scheme was the primary reason for local entrepreneurs to be very reluctant to take risks as it created psychological barriers for starting businesses which resulted in unemployment.
The KCC&I has all along projected and submitted to the government, including the prime minister of India, that J&K, particularly the Kashmir Valley, local entrepreneurs have lost private initiative and one of the main reasons has been the recovery modus operandi adopted by them which is not in conformity of RBI guidelines and at the same time finishes the entrepreneurial risks which a businessman normally takes by such an attitude of the banks, Punjabi said, adding nowhere in the world such mode of recovery was resorted to and there were instances where the countrys highest court had reprimanded such irresponsible acts of recovery.
In this particular case, he said, the whole economic activity of Kashmir comes to standstill and maximum sufferers being tourism industry wherein not even 10 per cent of occupancy was recorded in 2008, 2009, 2010. The banks have to normally restructure loans and come forward with model of restructuring keeping in view the conditions of Kashmir.
He said the KCC&I had time and again pleaded that law and order was a problem of state and central governments and raised the issue of compensation to the business community from 1990.
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