Letter to BS: Bankers should not be the only ones blamed for rising NPAs

With the new dispensation at the Centre and steps taken to clean up the banking system, it was expected the era of directed lending was over

The editorial “The Mudra problem’’ (November 28) was pertinent. Both the governor and the deputy governor of the Reserve Bank of India (RBI) have expressed their dismay about the rising bad debts under Mudra. Their warnings should be heeded. After nationalisation, banks were directed to lend a huge chunk of their loans to the priority sector as a social obligation. The payback for this munificence was the creation of vote banks. These loans under various schemes were seen by the beneficiaries as hand-outs by the government with no obligation to repay. This myth was perpetrated by local level politicians who,