State cooperative minister RK Sethi said the state government has no option but to liquidate these banks as there is no possibility of reviving them. The CARD banks in the state have incurred a cumulative loss of Rs 46.57 crore as on March 31, 1998, besides owing nearly Rs 100.85 crore to the refinancing institution, the Orissa State Cooperative Agriculture & Rural Development (OSCARD) Bank. The CARD banks are also expected to recover about Rs 84.70 crore from their loanee members, Sethi said.

Meanwhile, the state government has come out with an action plan to revive 33 CARD banks after several rounds of discussions with the officials of theNational Bank for Agriculture & Rural Development. The 33 banks would become viable only if they could increase their credit business at the rate of 20 per cent per annum and recovery at the rate of 40 per cent.

The government has requested Nabard to re-roll the Rs 33-crore which is supposed to be paid back by the CARD banks. The banks have been asked to recover at least 60 per cent of their NPAs besides reducing unnecessary expenses and surplus workforce so that overhead costs do not exceed income.

Mismanagement, financial bunglings, bad debt and poor recovery are responsible for the sickness of these banks. Large-scale recruitments also crippled the institutions. However, the final blow was dealt by Nabard when it stopped refinance in December 1996, throwing the long-term loan disbursement to the agriculture sector in a disarray.