The Modi government dealt a death blow to the banking sector through demonetization: Randeep Singh Surjewala
New Delhi:
Congress leader Randeep Singh Surjewala on Wednesday accused the government of destroying financial institutes as well as public sector banks. In a press release, Surjewala referred to a number of issues relating to the country’s economy, accusing the government of failure.
“In March 2013-14, NPAs represented Rs.216,739 crore (3.8% of total loans). NPAs increased to Rs 9.35,000 crore in September 2019 (at 9.1%)” , he said criticizing the government. .
“RBl’s July 2020 Financial Stability Report shows bad loans in the banking system can reach 14.7 percent, a 20-year high. How did it explode so much? ”Asked the Congress leader.
Striking more at the government, he said: “With banks not being allowed to collect loans from defaulters, all other loans stopped. Bank credit growth was 14% when the Modi government took power in 2014. Bank credit Growth has now fallen to 4% and will soon drop to zero, according to RBl’s own report. This means that there is no money available for companies that need it because the banks are hesitant to lend. “
“This is precisely the reason why out of the 3.00,000 crore of Rs guaranteed to MSMEs announced with great fanfare, only 1,23,000 crore of Rs was sanctioned and an even smaller amount of 68,311crore was disbursed. History repeats itself everywhere, ”he told me.
Speaking of the revelations by former RBI Governor Urjit Patel, Surjewala added: “The overwhelming evidence of the Modi government’s dishonest intentions is now emerging. New revelations from former RBI Governor Urjit Patel have shown how the government has watered down the solvency and bankruptcy code, hampering the central bank’s efforts to collect bad debts. This benevolence towards the crony capitalists has been unfolding since Dr Raghuram Rajan’s first warning to the Prime Minister, which fell on deaf ears. “
“The Modi government has dealt the banking sector a death blow through demonetization and its impact continues to haunt the economy even after more than three years of that fateful evening of November 8, 2016. It has given nothing. The currency in circulation has now reached an all-time high – the highest of 14 percent of GDP, “he added.
Referring to the Rs 20-lakh-crore package announced by the government, the Congress leader pointed out: “The response of the Modi government during COVID was love at first sight of the Rs 20 Lakh Crore package which resulted in a meaningless formality. Food credit growth is almost zero and bank credit growth drops from 4% to the benchmark “O”. Banks just re-deposit the money with the RBI. “
