Rafale deal controversy

It is baffling that following the apex court order, the Centre presented a redacted version of the Rafale deal decision-making process in a sealed envelope. It revealed price details of Rafale fighter jets, but it did not talk about the offset partner, giving the lame excuse that Rafale manufacturer Dassault or its weapon vendor is yet to submit a formal proposal in the prescribed manner, indicating details of Indian offset partners and products for offset discharge. The main allegation against the government is that it has shown favour to Anil Ambani-led Reliance Defence by choosing it as anoffset partner. Now the government must provide details of this crucial decision.

New Delhi

Dassault CEO Eric Trappier’s recent interview on the Rafale deal looked like ‘match-fixing’. His statement that the Rafale deal is clean is understandable as his companycannot forgo the lucrative deal. Dassault wants us to believe that it opted for Reliance as offset partner over HAL without being asked to do so by India. Former French President Francois Hollande made the explosive revelation that the Anil Ambani firm was made the partner at India’s behest. Dassault did not explain why it chose an inexperienced Indian company. Further, Dassault CEO’s assertion that Rafale deal is 9 per cent cheaper is irreconcilable with the 300 per cent rise in the aircraft’s price.

Maruthancode, Kanyakumari

It was a historic day for India when Prime Minister Narendra Modi inaugurated an inland port in Varanasi on the Ganga River and received India's first container vessel that sailed from Haldia, Kolkata on the inland waterway. This project is aimed at developing the stretch of the river between Varanasi and Haldia in West Bengal, for navigation of large vessels weighing up to 1,500 tonnes to 2,000 tonnes. I am sure this inland waterways project will help to promote a cheap and environment-friendly means of transportation. Modi deserves a big thumbs-up for this immense project.

Madhya Pradesh

Banks resorted to aggressive retail loan push after facing huge defaults in corporate sector. Apart from delinquency there are other reasons for the retail focus.

The risk is spread to more accounts and default up to 25 per cent does not impact the bottom line much since the pricing for unsecured loans carries higher interest rates compared to corporate sector where they arm-twist banks for better pricing and banks also succumb to pressure with eye on the volumes and cost of monitoring. With technology, banks have access to the credit history of the borrowers in retail segment through CIBIL score thus minimising the risk. Housing loans are the most attractive in retail segment since the risk weight for such loans is much lower than other loans. The competitive edge in retail is the turnaround time, where the private sector scores over the PSBs. But the risk with private banks is they outsource retail loan sourcing and processing , which is fraught with higher risk since the outsourced agency will have more concentration on the volumes than the safety of advance. Whereas PSBs have in-house marketing and processing and the personnel are more vigilant.

Banks must realign their credit policies in tune with the market demand besides the economic scenario. But at the sane time banks cannot totally shy away from lending to corporates doing progressive business. The lessons learnt in the past may be a guideline for a guarded approach in futureBanks need volumes to build up their bottom line for which medium sized loans are needed.

Madurai

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