Letters: Banking sector woes

With reference to “The audacity of hope” (March 13), the Bharatiya Janata Party’s astounding victories in Uttarakhand and UP point to the abundant faith of voters on the PM and his government. The electorate has great expectations. To fulfil those, governments at the states and the Centre have to quickly initiate reforms to ensure speedy economic growth and social development. Reforms in the financial sector, particularly banking, are yet to yield results. The banking sector is facing a crisis due to ever-increasing bad assets. The government and the regulators are proving incapable of controlling this. Two things are spiralling the growth of non-performing assets. On the one hand are the stressed balance sheets of the private sector and on the other are borrowers who are deliberately avoiding repayments. Despite various measures the resolution of bad assets remains elusive. Borrowers who willfully defaulted on repayment of dues to banks are defeating recovery measures. And the Centre is showing a lacklustre attitude when it comes to supporting the banking sector to ensure recovery of bad assets.

The exchequer is being drained due to the rising credit cost of banks. The prime minister must look at radical policies and actions to cleanse the sector. Recovery of public money from wilful defaulters must be accorded highest priority.

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