TN tops in Mudra; BJP woos Tamils with loans

Parimala, a resident of North Chennai, has been running a wholesale medicine business for over a decade. Unable to come up with collateral that would satisfy bankers, she couldn’t raise money to expand her business. Two years ago, however, she got what she wanted: ₹25 lakh as soft loan under the Mudra scheme.

Sivaramasubramanian, a milk vendor of Madurai, was in trouble since his 10 milch cows were getting old and battling disease. Advised by a friend, he got a loan of ₹50,000 through the Sishu scheme of Mudra. With the money, he bought three milch cows and his business picked up. Now, he is in the home stretch of repaying the loan and thinking of applying again.

Chellam, a tailor and saree seller in Salem, relied on self-help groups to get credit. In 2016, she got a bigger loan from Mudra which helped establish her business on a stronger footing.

The above are just three of the millions of beneficiaries in Tamil Nadu, who are thankful to a BJP worker for getting them the Mudra loans. The state BJP has taken up facilitating Mudra loans as among its priorities and has an ongoing coordinated effort towards that.

Overall, Tamil Nadu leads in Mudra loan distribution. In 2017-18, around ₹25,000 crore was distributed in the State, which accounts for 10 per cent of all the Mudra loans granted nationwide and represents a 40 per cent increase over the previous year. Some estimates suggest that over three years, at least one-third of the Tamil Nadu electorate has received Mudra loans. And BJP workers have nudged many voters towards these loans.

In Tamil Nadu, BJP workers play a key role in loan distribution, operating as facilitators and mediators. The party has a state-level Mudra coordinator working out of Kamalalayam, the headquarters in Chennai. District-level coordinators have also been functioning.

While workers of other parties like the DMK, the AIADMK or even the Congress facilitate the distribution of support, loans and welfare coming from the state, the BJP is leveraging central schemes such as the Mudra. “After the scheme came into effect, we organised meetings in every district for women cadres and made them aware,” says Meenachi, state general secretary of Mahila Morcha, Kancheepuram North.

In Cuddalore district alone, the women cadres helped more than 200 women get the loans. While party workers sometimes go with the applicants to the banks, in other cases they make women aware of the types of loans and help them fill the forms.

It would take more than just a few years of such work for the BJP to make a meaningful mark in the state, says M Vijayabaskar, a professor at the Madras Institute of Development Studies whose focus is industrial organizations and labour markets. He is skeptical of the loans having a spin-off effect leading to greater productivity and jobs.

Vijayabaskar questions the authenticity of figures regarding Tamil Nadu’s performance, saying bankers may have been under pressure to meet targets. Bank authorities are being pressured to meet the targets and this could also be the reason for the surge in the increasing number of Mudra account holders in the state, he adds.

“I came to know that if you need the loan in Maharashtra, you should approach the BJP party office instead of banks. The party will provide the applications and only through them you will able to get the loans,” he says. In Tamil Nadu, however, the BJP’s ideology presents a barrier that cannot be overcome by such patronage, he adds.

An ideological struggle
It has not been easygoing for the party that is yet to sink roots in the state. “There were some initial hiccups, when we approached the banks for loans under this scheme. The banks didn’t believe us, even though we were associated with the ruling party at the Centre,” says Malarkodi, state treasurer of the BJP’s Mahila Morcha, Tirupur.

After repeated follow-ups, they were able to get the loans, says Malarkodi who has helped more than a dozen women get the loans. “Once the women started repaying the loans, banks started trusting us,” she says.

Sometimes bankers were reluctant to take up the scheme. “Most of the bank managers have communist-oriented mindset. Because of that, they were not encouraging the loan schemes brought in by Modi,” says S P Saravanan, state vice president of ST Morcha, Cuddalore. He says he had to struggle but was able to secure the loan for nearly 100 people.

“We asked the district collector to help us. Since then there has been no difficulty,” he says. Besides Mudra, Saravanan claims to have helped to get free LPG connections to more than 10,000 people in his parliamentary constituency of Chidambaram.

Sivagami Paramasivam, the party’s state vice president, agrees with Saravanan’s view that bankers in the state are often ideologically inimical to central schemes. “It happens mostly with nationalized banks. In some cases, religion also plays a role,” she said. Sivagami says party workers don’t insist that the beneficiaries should be associated with the BJP.