NEW DELHI, Nov 7: The Bank of Baroda has sanctioned loans worth Rs 800 crore for infrastructure projects during the current financial year, in line with the government's emphasis on lending to the core sectors of the economy.

``We have so far cleared Rs 800 crore of loans for infratructure projects, including telecom and power projects,'' chairman and managing director of the bank K Kannan said here on Friday.

Besides, the bank has also provided guarantees for Rs 1,300 crore worth of infrastructure projects, Kannan said, adding that the bank had successfully accelerated lending for the small and medium industries.

``We have gone all out to provide credit for the genuine borrowers and have left it to the branch level general managers and managers to clear retail and other loans,'' he said. Kannan said his bank had been successful in recovering between Rs 300 crore to Rs 400 crore every year due to liberal settlements.

``We try to forgo a bit here and there while pursuing our non-performing assets, as a result of which we have achieved a lot of recovery,'' he said. Kannan said much of the non-performing assets were due to the bunching of these liabilities over the last so many years without write off or other provisions.

``I agree it requires courage to work on out-of-court settlements for higher recovery but this has been found to be quite fruitful going by our experience,'' he said. Kannan said the government had been providing support to the banks for implementing employment schemes such as the prime minister's Rozgar Yojna and the integrated rural development by giving `subsidies' in the form of additional funds.

Emphasising on the sanctions provided by the Bank of Baroda for infrastructure projects, Kannan said this includes two projects in Tamil Nadu and two in Madhya Pradesh.

The bank has also provided two corporate loans for the telecom and a port project, he said.

Kannan said complaints about lack of credit disbursement from the banks came largely from the corporates last year. He said the situation had improved following expectation of release of a total of Rs 25,000 crore of lendable resources by gradual reduction of cash reserve ratio till March 1998.

Kannan, however, said a lot needed to be done to accelerate advances for the retailers and other relatively unknown corporate houses.

``There is a lack of uniformity in the flow of credit, area-wise, sector-wise and category-wise, which needs to be corrected through better distribution of credit,'' he said.

He said since the inception of the integrated rural development programme (irdp), bank credit of the order of Rs 18,335 crore and government subsidy of Rs 11.418 crore had been provided to 5.09 crore families living below the poverty line as on March 1997.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.