National
Bailout not good but banks need to be strengthened: Jaitley
New Delhi, Jan 4 (IANS) Noting that the “bailout” for state-run banks through the Rs 2.12 lakh crore recapitalisation plan has turned out to be a “moral hazard” in view of the corporates’ inability to pay back loans, Finance Minister Arun Jaitley on Thursday said that capital infusion is solely aimed at strengthening the banking system.
He was replying to the debate on his Ministry’s supplementary demands for grants for 2017-18 in the Lok Sabha seeking Parliament approval for additional expenditure of Rs 80,000 crore towards recapitalisation of public sector banks (PSBs).
“Banks have given money to industrialists in the past… however, some are now sitting in London, others cannot pay back,” the Finance Minister said in an obvious reference to corporate accounts which account for a major portion of the bad loans accumulated by PSBs, including the case of absconding industrialist Vijay Mallaya, who has been declared a proclaimed offender by a Delhi court.
“This is the moral hazard with the bailout but we have to strengthen the banking system,” he said.
Jaitley also said that without bringing politics into the discussion on what he has earlier described as a “legacy issue”, the effort now is to improve the lending capacity of banks through infusion of adequate capital.
Referring to the Rs 2.12 lakh crore recapitalisation plan for state-run banks approved by the government in October, he said the objective is to ensure that the lenders’ ability to support growth is not impacted by their combined non-performing assets (NPAs) which have crossed the staggering level of Rs 7.5 lakh crore.
“In order to correct the situation, we brought in the Indradhanush plan to infuse Rs 70,000 crore spread over a period of three years, which is coming to an end.
“However, this money has proved inadequate owing to the provisioning amount going up on account of the Asset Quality Review (AQR) for banks ordered by the RBI, which brought out the real dimension of NPAs,” he said.
“So we need to put in more money and it becomes a bailout, which is not an ideal idea but it is important to keep the banks in good health,” he added.
Participating in a short-duration discussion in the Rajya Sabha on the state of the economy earlier on Thursday, Jaitley said that it was reckless lending by banks during the boom years in the previous UPA government that had led to accumulation of such huge NPAs, or bad loans, in the Indian banking system.
And this “reckless lending without proper risk management has affected the banks’ capacity to support growth” he said, adding that the massive lending by banks in the high-growth period after 2008 is now being reflected in their accumulated bad loans and through heavily leveraged corporate balance sheets.
–IANS
bc/him/vd
Lucknow: Vishal Singh, a renowned social worker from Lucknow, also known as Foodman, has once again made India proud. He was honored by the Happy Hands Gloves Cooperative Limited Company in Korathai, Thailand, for his work with the Hunger Free World Mission.
The Hunger Free World Mission’s meeting was held in Korathai, Thailand, under Vishal Singh’s leadership. Representatives from several countries, including Mr. Raja Dwivedi (Managing Director of Happy Hands Gloves Limited), Thailand Coordinator Mr. Raja Mishra, and member Mr. Varun Singh, attended the event.
Under Vishal Singh’s leadership, the attendees took a pledge to work together toward creating a hunger-free world.
Speaking on the occasion, Vishal Singh explained that the main goal of the Hunger Free World Mission is social participation. He said the mission is not just about feeding people but also about meeting other basic needs of those who are struggling. The mission focuses on helping families of terminally ill patients in hospitals by providing food and shelter. It also works to fulfill essential needs like education, jobs, and care for the elderly.
For the last 16 years, the Vijay Sri Foundation has been providing free services, benefiting thousands of people. Vishal Singh highlighted that the mission aims to gain global recognition like other organizations such as WHO, WWF, and Red Cross, which work for social causes.
During this meeting, Vishal Singh was appointed as the Chairman of the Hunger Free World Mission by representatives from various countries. They also discussed holding regular meetings in different countries to push the mission forward.
Business tycoon Dr. Abhishek Verma has also supported this humanitarian mission, vowing to promote the idea of “Seva Parmo Dharma” (Service is the highest duty) worldwide. Vishal Singh praised him, stating that people like Dr .Abhishek Verma inspire others to work for the betterment of society.
Recently, Romania’s Ambassador, Mr . Daniela Sezonov Ţane, invited Vishal Singh to the Romanian Embassy in Delhi, where they discussed the mission in detail. Impressed by his humanitarian work, she honored Vishal Singh and invited him to Romania to take the mission forward .
Food man Vishal Singh has been serving the people of India for the past 16 years. Through the Vijay Sri Foundation, he provides free meals to cancer patients & their families ,shelter, and education for women & children along with running free old-age homes in Lucknow.
In addition to his humanitarian work, Vishal Singh also addresses issues like crime and corruption through his role as Chairman of Seva Path Media and Managing Director of Vijay Sri Foundation.
During the COVID-19 pandemic, Vishal Singh and his team worked tirelessly to provide food and help to the needy, including starving children, elderly citizens, and pregnant women. Despite contracting the virus himself, he continued to assist others after his recovery. He even created a life-saving oxygen regulator using household items, which was praised by doctors both in India and abroad.
In his address at the meeting, Vishal Singh spoke about his mission to create a hunger-free world. He pointed out that India’s large population, along with issues like unemployment and poverty, has caused the country to fall on the Hunger Index. He urged people to contribute just one handful of grains daily to help create a hunger-free world.
He concluded by saying that through social participation, we can empower the people around us, meet their basic needs, and work together to build a stronger, more prosperous, and developed society.
Foodman Vishal Singh Honored for Hunger Free World Mission in Bangkok
Dr. Abhishek Verma Dedicates a Shelter in Memory of His Mother, Veena Verma, at KGMU; Inaugurated by Daughter Nicolle Verma
Cheers and Cheers: Barzilla’s Joyful Ode to Inclusivity and Celebration
Casino Days Reveal Internal Data on Most Popular Smartphones
Meghalaya Reserves Legalized Gambling and Sports Betting for Tourists
IPL 20202 UPDATE: KXIP vs MI IPL Dream11 Team Prediction for Today Match, Update Point Table of all Team.
In a Live debate AAP leader Syed Asad Abbas hurls abuses to BJP spokesperson Nupur Sharma.
‘India’s Most Wanted’ trailer out Arjun Kapoor on hunt of Osama-Bin-Laden
Time to move on: Sonakshi on Shatrughan’s joining Congress
