Former CAG Vinod Rai's recently launched Book 'The Diary of the Nation's Conscience Keeper - Not Just an Accountant' talks about the LOOT & Misuse of PSU Banks (owned by Taxpayers & Public) to finance a group of Businessmen!#TransformIndia
The state of PSU Banks, their lending practices & the high NPAs that require more Taxpayer money to bail out – are all issues that I have highlighted & more specifically during #Elections2014 campaign & my #Budget2014 Speech.
During the launch of his book last week, Mr. Rai emphasised that through his book, he wanted to reveal things while he was in office as he thinks a large number of people need to know what "Transparency" & "Accountability" is all about! These factors drove Rai to write his book & most importantly for people to know how the Govt really functioned! So, the book is an important read for all of us, who are involved/interested/concerned about the falling standards of Governance & Politics in our country - especially those concerned about the rampant growth & proliferation of nexus of Politicians & Business. Among other issues, Rai's Book touches upon controversial matters such as irregularities in #2GSpectrum & coal block allocations, as well as the role of the then Prime Minister.
One of the key issues he talked about, is the misuse of PSU banks (owned by Taxpayers & Public) to finance a group of Businessmen & how bad loans (NPAs) are increasing. In his words "#Kingfisher & #Bhushan Steel Loan defaults are only a trickle! The CDR mechanism was introduced to help companies refinance their debt in the face of high interest rates. Instead, it has morphed into a mechanism that allows the cronies to benefit, at the cost of the health, profitability & public equity of PSBs. Additionally, it has created a moral hazard of the worst kind where big businessmen glibly escape the responsibility of repaying personally guaranteed loans while banks pounce on small and middle income families and SMEs defaulting on home, car, 2-wheeler, farming education loans and other loans.
The issue of exploitation of PSU banks is one that I have repeatedly raised within Parliament & outside ever since I first stepped into Parliament in 2006. Under the#UPAGovt top 9-10 industrial groups have cornered loans amounting to almost 95% of the Indian Banking System's net worth! Mr. Rai has raised exactly these concerns in his book - he cites the instances of how an Airline Company & a Steel company have benefited greatly from loans provided by these banks, as part of their Corporate Debt Restructuring (CDR) mechanism.
Here are some of my interventions:
Three years ago in August 2011, I had highlighted these issues - of PSUs incurring losses due to CDR in a question to the then Finance Minister #Chidambaramhttp://bit.ly/1sgIicu
Then, in December 2011, I asked #UPA Finance Minister Chidambaram highlighting the fast rise of PSUs : http://bit.ly/QHLBIT
I had suggested that the Finance Minister Arun Jaitley & Prime Minister Narendra Modi focus on this as a priority issue to restore the health of the financial sector & the Banking System. Read my Post during #Elections2014: http://on.fb.me/1o9As0O& the #Budget2014 Speech: http://bit.ly/1lCMdrp. I had even raised this issue during a discussion in Parliament on the Securities Laws (Amendment) Bill, 2014. Read my speech: http://bit.ly/1yqLkIE
The Govt has only responded to this loot of the PSU banks after PM Narendra Modi's Govt took over!
In June this year, In a letter to the new #NDA Finance Minister Arun Jaitley (Read:http://bit.ly/1t2tryx) I had raised the concern that the NPAs of Public Sector Banks had risen to as high as Rs. 2.03 lakh crore as of September 2013, which is astonishingly enough, much higher than those of Private Banks! This issue is serious concern given that tax payer money is left exposed at the hands of banks, which have become piggy banks for the rich and powerful.
Recent actions of the Finance Minister Arun Jaitley & #RBI Governor#RaghuramRajan show that Govt is going to usher in Transparency & Reforms in how taxpayer owned PSU banks are managed & are accountable.
#TransformIndia #India #VinodRai #CAG #India #2GScam #2GSpectrum#CoalGate #Corruption
( hari krishnamurthy K. HARIHARAN)"think of them as Sand paper.
They Scratch & hurt you,
but in the end you are polished and they are finished. ''
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