New Delhi: Finance Minister Nirmala Sitharaman on Tuesday rebutted Congress leader Rahul Gandhi’s accusations about writing off the loans of wilful defaulters worth over Rs 68,000 crore saying that writing off a bad loan does not mean that the loan has been waived off. Banks continue with the recovery process against the defaulters, said the finance minister.
She also accused Rahul Gandhi and Congress party of brazenly misleading the people without understanding the context as scheduled commercial banks wrote off the loans worth over Rs 1.45 lakh crores during the last four years of Prime Minister Manmohan Singh’s government.
The Finance Minister said the provisions for write-offs of a bad loan is being made for the non-performing assets (bad loans) of banks as per the four-year cycle laid down by the Reserve Bank of India.
“Upon full provisioning being done, banks write-off the fully provided NPA but continue to pursue recovery against the borrower,” said Nirmala Sitharaman.
“No loan is waived off,” asserted the finance minister while explaining the procedure followed by the banks to recover the outstanding amount from a wilful defaulter even if a bad loan has been written off from the concerned bank’s balance sheet.
“They resort to sensationalising facts by taking them out of context,” said the finance minister in her bid to highlight the difference between writing off a bank loan and waiver of a bank loan.
In a series of tweets, Nirmala Sitharaman also blamed Rahul Gandhi for misleading the people on the issue of wilful defaulters, bad loans and write-offs.
“Between 2009-10 & 2013-14, Scheduled Commercial Banks had written off Rs.145226.00 crores. Wished Shri @RahulGandhi consulted Dr. Manmohan Singh on what this writing-off was about,” she said in a tweet.
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Today’s attempt of @INCIndia leaders is to mislead on wilful defaulters, bad loans & write-offs. Between 2009-10 & 2013-14, Scheduled Commercial Banks had written off Rs.145226.00 crores. Wished Shri.@RahulGandhi consulted Dr. Manmohan Singh on what this writing-off was about.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020 " class="align-text-top noRightClick twitterSection" data="
">Today’s attempt of @INCIndia leaders is to mislead on wilful defaulters, bad loans & write-offs. Between 2009-10 & 2013-14, Scheduled Commercial Banks had written off Rs.145226.00 crores. Wished Shri.@RahulGandhi consulted Dr. Manmohan Singh on what this writing-off was about.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020Today’s attempt of @INCIndia leaders is to mislead on wilful defaulters, bad loans & write-offs. Between 2009-10 & 2013-14, Scheduled Commercial Banks had written off Rs.145226.00 crores. Wished Shri.@RahulGandhi consulted Dr. Manmohan Singh on what this writing-off was about.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020
She also blamed the previous UPA government for creating the mess in the banking sector.
“Useful to recall the words of Shri Raghuram Rajan: “A large number of bad loans originated in the period 2006-2008,” Nirmala Sitharaman said in a tweet while referring to the date of origination of those bank loans that later turned in to non-performing assets or bad loans.
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...while private sector banks were getting out. RBI could have raised more flags about the quality of lending...” RR Rajan.(Source: @IndiaToday Sept 11,2018 and many other print& electronic media). From 2015, PSBs were asked by GoI to check all NPAs >50 crore for wilful default.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020 " class="align-text-top noRightClick twitterSection" data="
">...while private sector banks were getting out. RBI could have raised more flags about the quality of lending...” RR Rajan.(Source: @IndiaToday Sept 11,2018 and many other print& electronic media). From 2015, PSBs were asked by GoI to check all NPAs >50 crore for wilful default.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020...while private sector banks were getting out. RBI could have raised more flags about the quality of lending...” RR Rajan.(Source: @IndiaToday Sept 11,2018 and many other print& electronic media). From 2015, PSBs were asked by GoI to check all NPAs >50 crore for wilful default.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020
“Those defaulters who do not repay despite having the capacity to pay, divert or siphon-off funds, or dispose of secured assets without bank’s permission are categorised as wilful defaulters,” Nirmala Sitharaman said while explaining the definition of wilful defaulters.
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“They are those well-connected promoters who benefitted from UPA’s ‘Phone banking’,” said the finance minister while accusing the previous UPA government of pressurizing the public sector banks to give loans to influential people despite their history of defaults.
Strong action against wilful defaulters
In a series of tweets, Nirmala Sitharaman also listed out the measures taken by Prime Minister Narendra Modi’s government to recover the money from wilful defaulters.
She said it was Prime Minister Narendra Modi’s government that has been pursuing wilful defaulters as it has filed 9,967 recovery suits, 3,515 FIRs, and also invoked the Fugitive Amendment Act against these people.
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Mehul Choksi Case : Attachments of Rs 1936.95 Crore including foreign attachment of Rs 67.9 Crore. Seizure of Rs 597.75 Crore. Red Notice issued. Extradition Request sent to Antigua. Hearing for declaration of Mehul Choksi as Fugitive Offender is in progress.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020 " class="align-text-top noRightClick twitterSection" data="
">Mehul Choksi Case : Attachments of Rs 1936.95 Crore including foreign attachment of Rs 67.9 Crore. Seizure of Rs 597.75 Crore. Red Notice issued. Extradition Request sent to Antigua. Hearing for declaration of Mehul Choksi as Fugitive Offender is in progress.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020Mehul Choksi Case : Attachments of Rs 1936.95 Crore including foreign attachment of Rs 67.9 Crore. Seizure of Rs 597.75 Crore. Red Notice issued. Extradition Request sent to Antigua. Hearing for declaration of Mehul Choksi as Fugitive Offender is in progress.
— Nirmala Sitharaman (@nsitharaman) April 28, 2020
“Total value of attachment & seizures in the cases of Nirav Modi, Mehul Choksi and Vijay Mallya is Rs 18,332.7 Crore,” said the finance minister while rebutting the allegation of Rahul Gandhi against the government.
The finance minister also gave the details of individual actions taken against high profile loan defaulters like Vijay Mallya, Mehul Choksi, and Nirav Modi.
In the case of fugitive liquor baron Vijay Mallya, Nirmala Sitharaman said the assets worth Rs 8,040 crore have been attached, and assets worth Rs 1693 crores have been seized.
She informed that in a major victory for the government’s effort to extradite him to India, the UK high court has also ruled in favor of Vijay Mallya’s extradition to the country.
While giving the details of fugitive jeweler Mehul Choksi, Nirmala Sitharaman said assets worth Rs 1936.95 crores have been attached, and the assets worth Rs 597.75 crores have been seized. It also includes attachment of foreign assets worth Rs 67.9 crore.
“Red Notice issued. Extradition Request sent to Antigua. Hearing for declaration of Mehul Choksi as Fugitive Offender is in progress,” informed the finance minister.
While giving the details of high profile diamond baron Nirav Modi, the finance minister said his movable and immovable properties worth Rs 2,387 crore have been (attachment of assets worth Rs 1,898 crores and seizure of assets worth Rs 489.75 crore).
“He (Nirav Modi) is in prison in the UK,” pointed out Nirmala Sitharaman while underscoring the strong measures taken by the Union government against high profile wilful defaulters who fled abroad.
Nirmala Sitharaman also clarified that in all these cases no loan has been ever waived off as alleged by Rahul Gandhi.
Information not concealed from the Lok Sabha: FM
She also rejected the accusation of concealing the information from the Lok Sabha as the issue came to the fore in the last two days after a Mumbai resident Saket Gokhale obtained the details of the top 50 wilful defaulters from the Reserve Bank of India by filing an RTI application.
Nirmala Sitharaman said the details of borrowers, flagged as wilful defaulters by public sector banks under the Central Repository of Information on Large Credits (CRILC) that have an exposure of Rs 5 crore and above, was given to the Lok Sabha on November 18, 2019.
In response to a question raised by PR Natarajan, Communist Party of India’s Lok Sabha member from Coimbatore in Tamil Nadu, the government provided the company wise, bank-wise details of wilful defaulters for loans worth Rs. 5 crore and above.
The data given by the government in the Lok Sabha also included the details of loans given to the firms linked to fugitives such as Mehul Choksi and Nirav Modi and also to other firms like REI Agro Limited, Rotomac Global Pvt Limited, Kudos Chemie Limited, Ruchi Soya and Zoom Developers Limited among others.
The comprehensive list had the names of wilful defaulter companies as obtained by Mumbai resident Saket Gokhale from the RBI and released to the media on Monday.
Nirmala Sitharaman also said that the bank-wise details of the aggregate funded amount and outstanding amount that was technically/prudentially written off, pertaining to the top fifty wilful defaulters were provided as an annexure in response to a question raised by Rahul Gandhi in the Lok Sabha in March this year.
(Article by Krishnanand Tripathi)
