Letters to the editor dated May 27, 2020

| Updated on May 27, 2020

Avoiding NPAs

There is no doubt that the stimulus package announced by the Centre has seen a surge in concessions for the MSME sector. From the borrowers’ point of view, a moratorium of one year is offered, and an interest rate of 7.5 per cent for the working capital term loan sanctioned. From the bankers’ side, the additional loan sanctioned is fully guaranteed by the government. But for bankers, the responsibility increases in monitoring these accounts. They have to ensure that interest is to be recovered immediately, as there is no concession on this, and that instalments are paid on time. Generally, it is the practice of the bankers that whenever a working capital term loan is sanctioned, they will immediately recover the interest or principal by debiting the working capital account, thereby reducing the drawing limit. In such cases, the limit expires soon and the borrower stops operating the account due to cash crunch.

It should be remembered that the government guarantees the newly sanctioned working capital term loan. Hence it is the bankers’ responsibility to recover the interest and pricipal payments on the due dates from the cash flow of the borrower, and not by simply debiting the existing working capital account. Bankers should be more careful in dealing with these accounts.


Bhimavaram, Andhra Pradesh

Urban employment scheme

This refers to ‘Case for urban MGNREGA’ (May 27). The suggestion for an urban employment scheme similar to MGNREGA is welcome in the light of current situation. MGNREGA has to be modified suitably to provide urban employment in areas like railways, road transportation, hospitals, schools, local administration etc, which have immense scope for temporary unskilled employment. The skills required in urban areas will be different, but such a scheme will help greatly and may even prevent migrant problems in future. The government should work on a composite policy for urban unskilled employment , migrant labourers’ distress handling, insurance for loss of income by unorganised labourers etc, so that there is no immediate pressure to relocate in case of job loss in future.

M Raghuraman


Pointing fingers

This refers to ‘What is the exit strategy?: Rahul Gandhi asks Centre’ (May 27). One really wonders whether Rahul Gandhi himself has any idea about how best to resolve this menacing problem? Perhaps, he can only raise an accusing finger against the Modi government by questioning the ‘entry and exit’ timings of the lockdown, but cannot come up with any action plan to fight Covid-19 in its right earnest. Just making documentaries which raises concerns about the hapless migrant workers and the poor people is not enough. There are miles to go before we can sleep.

SK Gupta

New Delhi

No time for politics

This refers to ‘Move to topple Uddhav Thackeray government in Maharashtra?’ (May 27).The reported fact that the Centre might impose Presidential Rule in Maharashtra, blaming the State government for mishandling of the rising number of Covid-19 patients, has created some fissures amongst the Maharashtra Vikas Agadhi led by the Uddhav Thackrey. The genesis of such a speculation could be traced to the Nationalist Congress Party (NCP) President Sharad Pawar holding a closed-door meet with Chief Minister on Monday night soon after meeting the State Governor. Curiously enough, BJP leaders under the leadership of Devendra Fadnavis have been frequently visiting Koshyari.

While the Uddhav Thackeray evidently does not enjoy the cordial relationship with the Governor and the MVA, it still goes without saying that the time may not be ripe for toying with such an idea, more so when it may not be truly appreciated by the people of the State. Moreover, the Supreme Court may also strike down the imposition of President’s Rule on such a flimsy grounds, should the Centre dare to take such an imprudent step to ‘underhandedly’ settle its old political scores with Shiv Sena.

Vinayak G


Published on May 27, 2020

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