Instead of taking steps to recover the bad debts of banks through some
very serious steps, injecting tax payers money as capital into the PSBs
is unjustifiable and cannot stand public scrutiny. The bad borrowers
have enjoyed public funds and are allowed to go scot-free. The
depositors who have kept their life savings in banks are paid 4%
interest rate when the inflation is in double digits. All stake holders
of banks and the economy bear the brunt of non performing advances of
banks and this sort of subsidization has been going on for decades
without being questioned by stakeholders of banks or resisted by the
authorities. This approach of financing banks when the banks themselves
finance the capital of corporates started by unscrupulous borrowers
cannot be considered as good economics . The culprits should be
penalized and discipline should be introduced among the borrowers and
banks.
Dr T.V.Gopalakrishnan
( This comment in response to an article Government to infuse Rs 14000 crores in PSUs in next 15 daysthat appeared in Business Line dated 19/9/13).
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