Letters to the editor dated November 19, 2020

This refers to ‘Is ‘Nudge’ a desirable public policy tool?’ (November 19). The purpose of applying the nudge theory is to change the behaviour of people in the desired direction voluntarily. As such the test of its meaningful application is whether it serves public good or not. Its use becomes more relevant when the policy is good — popularising private toilets, for instance — for the public but there is a resistance from them. Voluntary behavioural change can be better achieved by transparent policy than ‘nudge’.

Pune

Apropos ‘Hastily engineered mergers to rescue troubled banks have obvious shortcomings’ (November 19), delayed action on the part of the RBI has led to severe erosion of Lakshmi Vilas Bank’s accumulated reserves and share capital. It is good that the regulator disapproved handing over the bank to a non-bank private entity.

However, instead of finding a buyer arbitrarily, the RBI could have asked one of the stronger public sector banks to come to the rescue, duly taking into account the bank’s technological platform, for an easy and seamless transition.

Chennai

Hastily engineered shotgun weddings for commercial banks skip important steps like inviting bidders. With the need to protect the depositors, the expedient rescue of LVB leaves little time for the regulator either to launch a forensic audit of the bank’s books or order an investigation into the flaws in the lending practice that led to the collapse. In the case of depositors, they will get lower interest on their deposits post merger, which is unjustified. Since some private banks offer better interest rates on deposits than public sector banks, some depositors prefer the former even if they aren’t managed well.

The government and the RBI could consider putting a ceiling on the rates of interest offered by all private/cooperative banks so that depositors don’t opt for these banks merely for higher rates.

Bhimavaram, AP

This amalgamation of Laxmi Vilas Bank and DBS Bank is not a win-win for all stakeholders. For any bank to have 25 per cent gross NPAs is a massive burden and since LVB’s shareholders did not come to its rescue, the RBI had to step in. The erosion of LVB's networth has to be addressed.

For DBS, the deal is a huge positive as in one shot it has acquired 560 branches to add to its small number of 26 branches. The RBI has sent a clear signal to all foreign banks that if they want to have a deeper presence in India they must have a long-term view with a subsidiary operation in India.

Noida

Apropos ‘Much ado about Chirag role in JD(U) decline’ (November 19), the BJP has established itself as a strong party in Bihar. The recent election results are a big blow to the JD(U).

The Mahagatbandhan missed the bus by a slender margin, and the RJD under Tejaswi Yadav has emerged strong in spite of Lalu’s absence. For the Congress, the Bihar results have come as yet another blow.

Sivakasi

Apropos ‘It’s so easy to blame the bureaucracy’ (November, 19), the factors causing project delays are many. They include nexus among politicians, bureaucrats and contractors, delays in the release of funds forcing the contractor to grease many palms, and changing priorities of successive governments. Consequently, the quality of construction too goes for a toss.

Though it is the cream of the candidates who join the civil services, what they learn, often the hard way, is to ‘compromise with the political masters’, or perish. Yet, there is a minority among them with unimpeachable integrity and efficiency. If their tribe were to increase, the transformation needs to happen at the very top and percolate down. Until then, the present state of affairs is bound to continue.

Chennai

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