Non-performing assets (NPAs) and restructured assets are galloping. Over the years many patchwork solutions have been tried. Last year, the Reserve Bank of India introduced a structure for rehabilitating "specified infrastructure and core industry projects" for tenures up to 80%-85% of the projects’ economic life. Is this a sham? Rajendra Ganatra, a banker and expert in stressed assets, rips apart this new structure and the earlier Corporate Debt Restructuring scheme. He finds it will only encourage promoters to play with lenders’ money. In fact, it is our money since it is government-controlled banks that are laden with bad loans. Mr Ganatra gives proof of ‘ever-greening’ of bad loans of three infrastructure companies, which raised debt ranging from 47.6% to 167% of their debt-servicing requirement. Don’t miss this eye-opening analysis on page 30.
Senior citizens, who invest their hard-earned money in private retirement homes, usually do not get what is promised by developers of such properties. Unfortunately, at present, there are no norms for this sector. Sucheta, in her Different Strokes, highlights the need of proper government advocacy for senior citizens, based on S Krishnamoorthy’s (an 80-year-old air-force veteran) plea, asking the Madras High Court to direct the state government to set up a specific regulatory authority for retirement homes.
The Aadhaar number is based on the social security number (SSN) concept used in the US. But did the US SSN simplify government administration? In Crosshairs, Sucheta writes that this may be far from the truth. In 2014, improper payments cost the US government a whopping $124.7 billion. Clearly, a national identity number has not prevented massive leakage of government funds. Why will it be any different in India, where governance standards are worse?
Moneylife Foundation will be coming to Chennai on 7 November 2015, with its flagship seminar on “How to Be Safe & Smart with Your Money”. Register online here - goo.gl/z3UoPA. Hope to see you there!