I am sure P Chidambaram didn't fret much when it came to deciding that Rs 60,000 crore loan waiver for the farmers. For anyone who understands the dynamics of rural vote bank in this country of ours this would have... Read The Article
Wonder when the govt will remove their blindfold and look into the real problems that trigger issues for the farmers. No matter how many times such waivers are brought about, the issue will keep frothing up. Is the govt aware of something called 'root cause' and analysis of the same and then applying the appropriate resolution on the culprit cause ? Why don't the IIM's provide some quick managerial lessons to these leaders ? I can only lament, "Jago India Jago".
( Posted: Monday , March 03, 2008 at 17:32 )
Siddharth
The loan waiver for "Farmers" is basically hog wash. The only kind of "farmer" to benefit from this waiver would be the likes of our former PM and "humble farmer" ans their ilk.
( Posted: Monday , March 03, 2008 at 13:32 )
Abhijit Salvi
An obvious populist move as pointed out by a so called "secularist" government. Do such waivers serve any long term benefits or is the government planning to sustain such remittances year after year? Why is it that the government always adopts a "chalta hai" attitude to make ephemeral concessions? I wonder what is stopping them from making a concerted effort towards digging down the root cause and extend the moolah towards efforts to fix these.. Even a concrete attempt that would show some results would have us tax-payers feeling proud to have contributed to it.
( Posted: Monday , March 03, 2008 at 10:08 )
CA. Dakshinamurthy
The current budget does not make allocation as to how it will reimburse the banks relating to written off loan.
The banks will keep their fingers crossed if an alternate govt. comes to power, since it has been seen over ages that a new govt. immediately after sworn in, reverse the measures taken by the previous govt. In such a case the bankers will really have their heart in mouth!!!
Disclaimer:- I am not an astrologer who has the ability to predict which party/alliance will be voted to power.
( Posted: Sunday , March 02, 2008 at 23:52 )
Vinod Kamath
The Banks are not going to lose anything. Infact, all Banks are celebrating. These written off loans were NPAs as far as Banks are concerned. So our FM has actually agreed to pay off their NPAs, which is good news.
The banking index tanked on Friday on hearing this news. I think we should see so gains on Monday after the news sinks in.
( Posted: Saturday , March 01, 2008 at 13:12 )
It is not correct to say that all these loans were written off loans. They may be an NPA, but as per RBI directions Agricultural loans are not classified as NPA, but are shown as standard assets by all Banks, for a minimum period of two years, eventhough the repayment obligations were not honoured. The FM will be issuing Loan waiver Bonds to Banks to provide liquidity,to enable them to lend further to the same borrowers, but ultimately it is the Tax payers who are shouldering the burden of waiver, none else. These loans are already availed and the waiver would not push any demand for products & services from the rural sector, but would naturally lead to inflationary pressures in the economy, as these Bonds would amount to market borrowings as in the case of Oil Pool deficit Bonds, FCI Bonds etc. Not showing such borrowings while arriving at fiscal deficits is misleading and that is the reason inflationary pressures are seen to be high inspite of the fact that fiscal deficits projected by the FM, being within the ideal limits. Although Loan waiver is a good politics, it is a bad economy management. The Govt has given a clear signal that every fifth year all agricultural loans would get waived, adversely affecting the ethical standards of the Indian public. Why personal loans availed by individuals/salaried employees not be waived ? Are they not contributing to the growth of GDP of the country ? Anyhow, all sub-lending would ultimately get written off by Banks. Whether you write off or waive, it hardly matters. -Varadarajan
( Posted by Varadarajan on Saturday , March 01, 2008 at 14:02 )
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