Banking
PSU banks have to stop becoming piggy-banks for politically friendly businesses

According to independent MP Rajeev Chandrasekhar,  the Modi govt should come out with a strategy to restructure and restore the health of these banks that are becoming piggybanks for politically friendly businesses 

Rajeev Chandrasekhar, an independent member of the Rajya Sabha, who is also a member of the Standing Committee on Finance, has called for a strategy to restructure and restore health of public sector unit (PSU) banks in the country.

 

Mr Chandrasekhar was speaking during the discussion on the motion of thanks on the President's address. He said, "The basic principle of fairness and equity stands turned on its head when home owners and two-wheeler owners have their assets seized on default of their loans, when multi-millionaire businessmen who owe Indian banks end up with little or no pain. This situation is neither tolerable nor acceptable, and the Indian PSU banks have to stop becoming piggy banks for politically friendly businesses."

 

He said, "The other big worry is the health of PSU banks – all of which are owned by the taxpayers and public of this country, but seem to have been run like some people’s personal fiefdoms - with the consequence that lakhs of crores of non-performing assets (NPAs) dominate their balance sheets and write off taxpayer equity. Regulatory competence here again needs to be examined which allows 10 industrial groups to borrow almost 90% of the Indian banking system's net worth and create the ‘too big to fail’ syndrome that puts the banks and taxpayers on the hook rather than the promoters."

 

The independent MP said he looks forward to the Narendra Modi government's approach to big business defaulters and a strategy to restructure and restore the health of PSU banks.

 

Mr Chandrasekhar also raised issues like GDP decline, investment cycle and government finances during his speech. "fiscal responsibility and a value for money culture must be brought into the Government. A culture that focuses on what got done, and not just how much money got spent - which seems to be even today the way to measure Government effectiveness. That must change. Public money and assets must be handled by Government with a sense of trusteeship. Public spending is notoriously leaky and fosters corruption, and worst, only a small percentage of spending is reaching people. Fundamental reforms in this area are necessary and long overdue and a new Approach to Government Spending is needed. Reduction of corruption and leakages in public spending is a key requirement to create headroom for Government spending at a time of fiscal constraints," he added.  

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COMMENTS

pawan

2 years ago

I request Modi to give a cabinet berth to rajeev Chandrashekhar .. A man of wisdom and forte.

Anil Nair

2 years ago

Bringing up public sector banks would eventually help in improving the economy of the country as the flowing out of money could be controlled.

Anil Nair

2 years ago

Good move by Rajeev Sir. Till now the Rich have been using the private sector banks to paddle their money and take money out of the country. With the change in the banking system the black money trafficking could be brought into control.

Arun Vijayan

2 years ago

It has got a great start. Now everything lies in the hands of our beloved PM Mr.Modi. A restructuring of banking system is needed to stop PSU banks from becoming politically friendly business.

Arun Vijayan

2 years ago

Brilliant move sir!! This wil certainly swipe of the dilemma of 'the rich becoming richer & the poor still poor !'..

tatvapragna

2 years ago

Accolades to this MP. Good to see such real issues raised and debated in Parliament. shocking to learn that 10 (influential, of course) industrial groups are allowed borrow almost 90% of the Indian banking system's net worth!! At least some one is out there talking 'real' issues! interesting to see what Modi will do to such issues.

tatvapragna

2 years ago

Not just on the Modi government's approach and strategy to restructure and restore the health of PSU banks, his every action is being looked forward by the whole nation. every one is waiting for those 'achche din'. Support, timely interventions and monitoring by all MPsm like Mr. chandrasekhar is doing, is absolutely essential.

S.S.A.Zaidi

2 years ago


The article brings out what actually is ailing thed banking system. I think mr Modi being at the helm things will start improving
Business ethics and integrity will be the guiding principles.Organisational culture would be saturtated with ethical values in the conduct of the busibess

Weakness on the Sensex, Nifty to persist: Wednesday closing report

Nifty may be pulled lower if it closes below the days low

Market on Wednesday gave up all the intra-day gains after hitting a new life time high in the morning session. Witnessing a gradual fall, the indices closed in the negative, breaking four days of positive moves.

The S&P BSE Sensex opened at 25,651 while the NSE Nifty opened at 7,672. Both the indices hit an all-time high at 25,736 and 7,700. However the weakness in the indices set in and the market closed in the negative. Sensex hit a low of 25,366 closing at 25,474 (down 110 points or 0.43%), while the  Nifty hit a low of 7,589  and closed at 7,627 (down 30 points or 0.39%). The NSE recorded a volume of 162.15 crore shares. India VIX rose 2.39% to close at 17.0600.

The top five gainers being IT (2.19%), Pharma (0.88%), NI15 (0.78%), Service (0.31%) and Bank Nifty (0.15%). The top five losers were Realty (4.30%), Metal (2.60%), PSE (2.52%), Media (2.32%) and CPSE (2.31%).

Of the 50 stocks on the Nifty, 16 ended in the green. The top five gainers were Infosys (3.31%), Kotak Mahindra Bank (2.57%), TCS (2.13%), Hero MotoCorp (1.47%) and Dr Reddy’s Lab (1.30%). The top five losers were Tata Power (5.38%), DLF (5.38%), Hindalco (4.48%), Coal India (4.19%) and NTPC (3.94%).

Of the 1,593 companies on the NSE, 666 closed in the green, 894 companies closed in the red, while 33 companies closed flat.

The Prime Minister, Narendra Modi on Tuesday decided to discontinue the four standing committees of the cabinet, which include the cabinet committee on management of natural calamities, cabinet committee on prices, cabinet committee on world trade organisation, and cabinet committee on unique identification authority of india. The Prime Minister will re-constitute the appointments committee of the cabinet, the cabinet committee on economic affairs, the cabinet committee on parliamentary affairs, the cabinet committee on political affairs and the cabinet committee on security.

State Bank of India (SBI) is planning to merge its three listed and two unlisted associate banks with itself. The three listed associate banks of SBI are State Bank of Mysore, State Bank of Bikaner and Jaipur and State Bank of Travancore.

India's merchandise exports jumped 12.4% to $28 billion in May 2014 over May 2013, data released by the government today showed. Imports declined 11.41% to $39.23 billion in May 2014 over May 2013. Oil imports rose 2.5% to $14.46 billion in May 2014 over May 2013. Non-oil imports dropped 17.9% to $24.77 billion in May 2014 over May 2013.

The trade deficit declined to $11.23 billion in May 2014, from $19.37 billion in May 2013. Trade deficit for the first two months of this financial year declined to $21.32 billion, from $37.04 billion during the corresponding period in the previous year.

Again today all the pharma and software stocks in the Sensex 30 pack closed in the positive, namely,  Infosys (3.64%), TCS (2.23%), Dr Reddy’s (1.67%), Cipla (1.03%), Sun Pharma (0.78%) and Wipro (0.41%).

Tata Power (4.98%), top loser in the Sensex 30 stocks, was recently in the news as it said that the company has raised its renewable energy capacity to 1,170MW with the commissioning of its 28.8MW solar plant at Palaswadi in Maharashtra.

Suzlon Enery (4.93%) was among the top two gainers in the ‘A’ group on the BSE. The company was recently in news for winning a repeat order worth Rs 750 crore from ReNew Wind Power for its 100.8 MW project in Rajasthan. The company said the order is for supply of 48 units of S97-120m wind turbine generators at Bhesada in Jaisalmer district, where ReNew Wind Power is setting up the project.

Future Retail (7.22%) was among the top three losers in the ‘A’ group on the BSE. The board of the company is considering various options for raising of funds upto Rs2,000 crore, comprising of (i) issue of shares / warrants on preferential basis to investors and promoters of approximately Rs400 crore and (ii) issue of shares of different classes on rights basis upto Rs1600 crore; accordingly it has approved the following fund raising resolutions. The company proposes to utilise the proceeds of the various fund raising options at least 75% for its debt reduction program in addition to also fund its future growth.

US indices closed flat with a positive bias, on Tuesday 10th June.

Data showed US wholesale inventories increased 1.1% in April, higher than estimates. A separate report showed job openings rose to 4.5 million in April from 4.17 million in March.

The World Bank cut its global growth forecast amid weaker outlooks for the US, Russia and China, while calling on emerging markets to strengthen their economies before the Federal Reserve raises interest rates. The bank predicts the world economy will expand 2.8% this year, compared with a January projection of 3.2%. The US forecast was reduced to 2.1% from 2.8% while outlooks for Brazil, Russia, India and China were also lowered. The setbacks may be temporary: the 2015 estimate for world economic growth was unchanged at 3.4%.

Except for Hang Seng (0.25%), NZSE 50 (0.25 points) and Straits Times (0.11%) all the other Asian indices closed in the green. Jakarta Composite (0.52%) was the top gainer.
European indices are trading in the red. US Futures too are trading lower.

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Activist urges Maharashtra home Minister to withdraw move to punish for Facebook 'like'
Bureaucrat-turned-activist and lawyer Abha Singh has termed the Maharashtra Government’s plan as 'draconian' that may set a dangerous precedent for democracy

Advocate and former bureaucrat Abha Singh has called for a withdrawal of  instructions given by Maharashtra Home Minister RR Patil to Mumbai police, to book persons posting offensive comments on Facebook and even those who 'Like' such comments. 
 
Adv Singh, in a letter sent to the minister, said, “If such draconian instructions related to freedom of speech and expression are not curtailed at this stage, this may set a dangerous precedent for our democracy.”
 
“Such type of draconian instructions are contrary to the provisions of Article 19 of the Constitution of India. Further, it is a settled position in international law that a ‘Like’ in Facebook amounts to a constitutionally protected free speech. A ‘Like’ is only an expression of opinion and the person ‘Liking’ a Facebook post cannot be assigned the culpability of the person making such a post,” she said in the letter sent to the Home Minister.
 
According to media reports, Patil had said the state was exploring the need for legislation to prevent misuse of social media, such as 'posting', 'sharing', and 'liking' communally provocative issues and photos, to avoid communal tension. Maharashtra ranks first in the country in terms of use of social media.
 
This follows recent incidents where defamatory posts by unidentified persons on Facebook, regarding Shivaji Maharaj and Shiv Sena chief Balasaheb Thackeray, caused the death of Pune based techie Mohsin Sadiq Shaikh. 
 
Even Maharashtra Deputy Chief Minister, Ajit Pawar was quoted by DNA as saying, “anti-social elements are misusing social media to spread hatred across the state. In the recent past, particular groups have been deliberately defaming social icons by morphing their pictures and uploading the distorted ones with fabricated messages. We want peace and harmony... (These) groups should be punished". 

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COMMENTS

Kisalay Somani

2 years ago

I think it's time Facebook pack their bags and shut shop in India - because if Maharashtra has it's way, I'll probably just go ahead and delete my Facebook account. Not that it mattered much, but was definitely a convenient way of catching up with long lost friends and family. Probably go the old school route of tracing down the person (if you are lucky) and calling them up :P

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