The Government will continue with the scheme of Rural Enterprise Development Corporation Limited (REDCL), under Economic Stimulus Plan (ESP), for rural development. The issue was raised by Nanong-Shumar MP Lungten Namgyal during the 2nd question hour session on Friday in the National Assembly.
MP Lungten Namgyel asked the Finance Minister, if the present Government is going to continue with the REDCL, which was initiated by the previous Government under the ESP. He said that loan received under special scheme of REDCL seems to create gap between rich and poor. The Business Opportunity and Information Center (BOIC) initiated by previous government in 2014 was closed and replaced by REDCL in 2016 under Companies Act, due to political controversy over the legality of BOIC.
In response, the Finance minister, Namgay Tshering said that the REDCL was established by the previous government to boost the poor GDP growth which was 2.14 in 2013. He said that REDCL has been facing management issues. “When we say REDCL has been facing management issues, it’s not that the present government will discontinue with it,” said Finance minister. He said that the present government will study the management issues and review the better plans and programs to consider the 63 employees who are currently employed.
The BOIC was started by the previous government in 2014 with the Nu. 5 B received as a block grant for ESP from the government of India. Out of 5 billion, Nu.2.1 B was used as a liquidity injection in banks, Nu.1.9 B has been allocated for revolving fund I (RF-I) and revolving fund II (RF-II) and, Nu.1 B was used in Ministry of Education as a Special Support Scheme Fund. “BOIC was started with RF-I and RF-II,” said finance minister.
With the political controversy, of Nu.1.9B revolving fund, Nu.1.5 B of RF-I was handed over to BDBL to continue with the service, and REDCL was established with Nu.400m of RF-II in accordance with the Financial Service Act.
Finance minister said that around 3900 projects have approved with the loans and 96 applicants have registered in REDCL for the project approval. He also said that non-performing loan is just 13 percent.
“For the benefit of 63 employees and people in rural area, the present government will review the management issues and continue with REDCL,” said FinanceMinister.
By Yeshey Tenzin