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The Modi Govt Used Ordinary Indians' Money to Square the Accounts of Wilful Defaulters, Fraudsters
The Modi Govt Used Ordinary Indians' Money to Square the Accounts of Wilful Defaulters, Fraudsters
The Modi Govt Used Ordinary Indians' Money to Square the Accounts of Wilful Defaulters, Fraudsters
BANKING ECONOMY
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This is the third article in the series on bank losses. Read the first and
second articles.
The manner in which finance minister, Nirmala Sitharaman, obfuscated
her reply to my starred question on August 1 shows quite clearly that
government is desperate to suppress any further data on bank losses,
beyond the humongous amount that is already in the public domain.
After 20 months of constant effort, one managed to ferret out the total
year-wise and bank-wise details of non-performing assets (i.e, loss-making
NPAs) and write-offs. These were presented through an article on The
Wire on June 18, entitled The Modi Government Must Answer for India’s
Historic Bank Loss of Rs 12 lakh crore. It covered the first eight years,
nine months of Modi’s rule, but now that we have the Reserve Bank (RBI)
figure for the full nine years, the amount lost by all banks increases from
Rs 12,09,606 crore to Rs 12,50,553 crore.
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Kroftman
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Never before in the history of India had banks lost and wiped out such a
gigantic amount, year after year, without a whisper of a scam or any
public debate of consequence. As expected, public sector banks were hit
the most, but private banks also picked up this virus and suffered.
Retribution has, of course, been sharper and swifter in private banks – as
Yes Bank’s Rana Kapoor and Chanda Kochhar of ICICI realised to their
cost.
In this third article of the series (read the first and second articles), we
reiterate with updated data how our bank deposits were used to square the
accounts of wilful defaulters, asset-strippers, and politically blessed
fraudsters. Many among the latter who rose to prominence with (and
hovered around) Narendra Modi looted lakhs of crores from bank funds
and then invariably scooted abroad to lovely pre-paid mansions and to
other luxuries.
Not one has been brought back to face trial and jail by the Modi
government, while the Manmohan Singh government had ensured that the
mighty Ramalingam Raju went to jail for his Satyam’s frauds. Singh’s
regime was booed out as corrupt by swashbuckling TV channels reporting
scam after scam, which were revealed ever so dramatically by a rockstar
Comptroller and Auditor General (CAG). It is a different matter, of
course, that many of those TV channels later sold themselves to Modi or
his capitalist buddies, and the ex-CAG is choking from the overfeed he
was rewarded with by Modi.
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Prime Minister Narendra Modi and finance minister Nirmala Sitharaman. Photo: PTI/Files
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On February 5 this year, another MoS of finance, Bhagwat Karad, replied
that “the total exposure to top 10 borrowers from Scheduled Commercial
Banks as reported in the Central Repository of Information on Large
Credits (CRILC) database is Rs 12,71,604 crore”. So we have an idea of
how much banks have lent to just the top 10 borrowers and we estimate
that the top 100 may have taken five to six times this amount. Of course, if
they have the right contact and indulgence, a large part of this would never
be returned to banks.
This is precisely our point, and we find that banks have been saddled with
some 69 lakh crore rupees of NPAs during Modi’s nine years. It was never
anywhere near a small fraction of this amount during the previous nine
years.
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These percentages of NPA to total loans are on the IMF website – and they
hover between 0.4 and 1.4 in advanced countries. Obviously, probity is
higher there, cronyism is less and anti-corruption watch stronger. Italy,
Spain, and Portugal have more ‘buddy-ism’ and such laxity increases their
percentage of endangered loans to between 1 and 1.5 percent.
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Cash. Photo: File
Also read: The Modi Government Must Answer for India’s Historic
Bank Loss of Rs 12 Lakh Crore
To get the answer, we may use night-vision glasses to see how much has
been siphoned off by known cronies and other criminals during the Modi
years – tragically, without any retribution.
Money hardly ever disappears – it travels from one pocket to the other. A
section of defaulting (or embezzling) businessmen gain from these de
facto waivers called write-offs, as the heat on their backs would be less.
Those big sharks who finance any ‘helpful’ political party can handle their
matter quite neatly with precise “corporate organisation” and leave no
trails of messy cash handling and fund transfers. Of course, if bankers, the
enforcement directorate, the CBI, the directorate of revenue intelligence,
the Serious Frauds Office, and other corporate and financial governance
regulators are really serious, they can crack this modus operandi, very
much like they hound cash transactions of the less sophisticated.
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