OPINION
Ten lakh crore corporate loans have been waived in the last five years. Unpaid debt in the bank’s account, i.e. corporate owners have taken loans from banks and have not paid them back. That amount has been waived.
Naturally, if 10 lakh crore is waived off the total non-performing loans accumulated by the banks, the amount of non-performing loans will come down. Banks can then claim that their NPA or non-performing loan burden has come down significantly.
“They want to show this as their operational success or efficiency.” And the finance minister bragged in her speech that it was because of her efforts that the banks were able to achieve this success.
What exactly is Nirmala Sitharaman’s success? The money given by the bank as a bank loan is not the personal money of the finance minister or bank officials. People of the country save their hard-earned money in banks.
That is the money that banks give as loans to corporate traders. Corporate owners receive money earned by the public through banks as loans. As usual, they do not pay that money and sit with their hands folded.
This is how the number of unpaid loans from the bank increases. The banks’ only source of income is interest on loans. When a corporate entity defaults on debt, income takes a hit as does capital. In this situation, when the government should take strict measures to recover the debt.
Instead of doing it, the Modi government is giving huge loot to the corporate by waiving the debt. But it is being promoted that the non-performing loans of the banks are decreasing.
Notably, since the Modi government came to power, the amount of corporate loan waivers has increased step by step. In the first year of coming to power (2014-15) loans were waived off 58 thousand crores of money.
“Just last year, only 32 thousand crores of loans were waived off.” In the year of demonetization, the loan waiver increased by one lakh eight thousand crore rupees. And the year the electoral bonds were launched, it further increased to 1.61 lakh crore.
In the next three years, an average of 2.2 crore rupees was waived annually. So, the ‘Chronology’ makes it clear how people’s money has been used in the service of corporate friends.
“Almost in line with the pace at which corporate loan waivers have increased since the introduction of electoral bonds, corporates have funneled huge sums of money into the BJP’s funds” through electoral bonds.
More significantly, the corporate tax rate has also been reduced significantly since the election campaign began.