Feature
PNB fraud: Assocham calls for privatising PSBs
In light of the massive Rs 11,300 crore ($1.8 billion) scam allegedly involving jeweller Nirav Modi that has hit state-run Punjab National Bank (PNB), industry chamber Assocham said on Sunday that the government should surrender its majority control of banks, which should be allowed to function like private sector lenders.
In a regulatory filing earlier this week, PNB said it had detected the gigantic fraud in one of its Mumbai branches, putting the quantum of fraudulent transactions at $1,771.69 million. The amount is equivalent to eight times the bank’s net income of about Rs 1,320 crore ($206 million).
“The PNB’s fraudulent transactions worth Rs 11,300 crore should act as a strong trigger for the government for reducing its stake to less than 50 per cent in the banks which should then be allowed to work on the lines of private sector lenders with a full sense of accountability to their shareholders protecting interest of depositors,” Assocham said in a statement here.
“The public sector banks (PSBs), ironically, are slipping from one crisis to the other and there is a limit the government can keep bailing them out at the cost of taxpayers’ money, even if it is the principal shareholder in these lenders,” it said.
The industry body said PSB senior managements spend bulk of their time “receiving and implementing directions from the bureaucrats even for innocuous issues.”
“In the process, the core banking functions, including all important risk mitigation and management, take a back seat.”
“The problem has become more grave with banks adopting new technologies which can prove both boon and bane,” it added.
In this connection, a Special CBI Court in Mumbai on Saturday remanded to police custody till March 3 three accused persons in the case.
The three includes a retired PNB Deputy Manager Gokulnath Shetty, Single Window Operator Manoj Kharat and an authorised signatory of the prime accused Nirav Modi’s group companies.
Besides these, the Central Bureau of Investigation (CBI) has named 10 other directors and officials as accused in the scam.
“Once the government equity in the banks is reduced below 50 per cent, there would be much more autonomy along with accountability and responsibility of the senior management,” Assocham said.
“The boards should then be truly taking the policy decisions while the CEOs would run the banks with full authority, coupled with the commensurate responsibility, instead of looking towards the bureaucrats for directions,” it added
Assocham Secretary General D.
S. Rawat in a statement urged the Reserve Bank of India (RBI) to take the lead to “engage with the industry in finding ways to do clean business in the entire financial sector, be it the public sector or private sector banks or even the non-banking finance companies.”
In this regard, Chief Economic Advisor (CEA) Arvind Subramaniam has also advocated more private participation in public sector banks.
Speaking at an event in Chennai on Saturday, Subramaniam said while the government was going for recapitalisation of public sector banks, the scrutiny, monitoring and disciplined deployment must be ensured only through greater private participation in banks.
According to him, there should be less public lending to private sector and the mode to achieve that is to have higher private participation in the banking sector.
He said more privatisation could be the way forward since there was no guarantee that better governance recommendations of banks, instead of privatisation, would be implemented effectively.
The State Scores Extra High on Gaming-Friendly Industry Index
Meghalaya scored 92.85 out of 100 possible points in a Gaming Industry Index and proved to be India’s most gaming-friendly state following its recent profound legislation changes over the field allowing land-based and online gaming, including games of chance, under a licensing regime.
The index by the UK India Business Council (UKIBC) uses a scale of 0 to 100 to measure the level of legalisation on gambling and betting achieved by a state based on the scores over a set of seven different games – lottery, horse racing, betting on sports, poker, rummy, casino and fantasy sports
Starting from February last year, Meghalaya became the third state in India’s northeast to legalise gambling and betting after Sikkim and Nagaland. After consultations with the UKIBC, the state proceeded with the adoption of the Meghalaya Regulation of Gaming Act, 2021 and the nullification of the Meghalaya Prevention of Gambling Act, 1970. Subsequently in December, the Meghalaya Regulation of Gaming Rules, 2021 were notified and came into force.
All for the Tourists
The move to legalise and license various forms of offline and online betting and gambling in Meghalaya is aimed at boosting tourism and creating jobs, and altogether raising taxation revenues for the northeastern state. At the same time, the opportunities to bet and gamble legally will be reserved only for tourists and visitors.
“We came out with a Gaming Act and subsequently framed the Regulation of Gaming Rules, 2021. The government will accordingly issue licenses to operate games of skill and chance, both online and offline,” said James P. K. Sangma, Meghalaya State Law and Taxation Minister speaking in the capital city of Shillong. “But the legalized gambling and gaming will only be for tourists and not residents of Meghalaya,” he continued.
To be allowed to play, tourists and people visiting the state for work or business purposes will have to prove their non-resident status by presenting appropriate documents, in a process similar to a bank KYC (Know Your Customer) procedure.
Meghalaya Reaches Out to a Vast Market
With 140 millions of people in India estimated to bet regularly on sports, and a total of 370 million desi bettors around prominent sporting events, as per data from one of the latest reports by Esse N Videri, Meghalaya is set to reach out and take a piece of a vast market.
Estimates on the financial value of India’s sports betting market, combined across all types of offline channels and online sports and cricket predictions and betting platforms, speak about amounts between $130 and $150 billion (roughly between ₹9.7 and ₹11.5 lakh crore).
Andhra Pradesh, Telangana and Delhi are shown to deliver the highest number of bettors and Meghalaya can count on substantial tourists flow from their betting circles. The sports betting communities of Karnataka, Maharashtra, Uttar Pradesh and Haryana are also not to be underestimated.
Among the sports, cricket is most popular, registering 68 percent of the total bet count analyzed by Esse N Videri. Football takes second position with 11 percent of the bets, followed by betting on FIFA at 7 percent and on eCricket at 5 percent. The last position in the Top 5 of popular sports for betting in India is taken by tennis with 3 percent of the bet count.
Local Citizens will Still have Their Teer Betting
Meghalaya residents will still be permitted to participate in teer betting over arrow-shooting results. Teer is a traditional method of gambling, somewhat similar to a lottery draw, and held under the rules of the Meghalaya Regulation of the Game of Arrow Shooting and the Sale of Teer Tickets Act, 2018.
Teer includes bettors wagering on the number of arrows that reach the target which is placed about 50 meters away from a team of 20 archers positioned in a semicircle.
The archers shoot volleys of arrows at the target for ten minutes, and players place their bets choosing a number between 0 and 99 trying to guess the last two digits of the number of arrows that successfully pierce the target.
If, for example, the number of hits is 256, anyone who has bet on 56 wins an amount eight times bigger than their wager.
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