Letters to the editor dated June 14, 2021

Apropos ‘Banks assessing value of promoters assets’ (June 14), the earlier apex court order that ‘the release of a company from its debt by liquidation or insolvency proceeding does not absolve the guarantors of their liability’ has certainly come as a shot in the arm for banks. The latter may now proceed against the promoters and recover shortfalls in cases under resolution plans, involving significant haircuts.

A recent case in point is Videocon Industries, where, reportedly, the banks would take a whopping haircut of ₹42,000 crore after the NCLT approved a bid for takeover of the company by the Anil Agarwal-backed Twin Star Technologies for ₹2,900 crore.

Banks being allowed to proceed against the promoters would also ensure that the latter do not indulge in reckless borrowing to expand their businesses into uncharted territories. Inculcating financial discipline in borrowers would also help banks improve their bottomlines.

Chennai

The process of obtaining personal guarantees and their invocation has been in vogue for long and what is new is the enablement that personal guarantees of promoters can be invoked even after the business is sold under resolution plan and bank dues paid off.

However, this provision itself may not help as there is the possibility of promoters alienating personal assets by transferring to family trusts.

This issue has to be overcome by legal enablement so that invocation of personal guarantees is fruitful.

Mumbai

As Covid in humans is showing a declining trend in India, zoonotic diseases are on the rise with several incidents of animals falling prey to them. Considering India’s huge population, there are greater chances of transmission from animals to humans.

According to a paper in the Indian Journal of Community Medicine in March 2020, of the 1,407 human pathogens detected, 816 were found to be zoonotic — that is, capable of being transmitted naturally between animals and humans. The surge in zoonotic infections like H1N1, SARS, Ebola, Nipah, Zika virus, etc., can be attributed to wildlife trade and the increasing practice of injecting livestock with steroids to enhance production.

Animal to human transmission of disease is a threat to the economy as well humans. A comprehensive strategy with a renewed focus on genome sequencing, testing and tracking of animals on a large scale can help tackle the problem.

Nainital, Uttarakhand

This refers to ‘Children as collateral damage’ (June 14). It is not surprising to learn that poor families are forced to send their young children into the labour market as the pandemic has taken a huge toll on them. But sadly, the problem does not end here.

The worst sufferers are the many children who have lost their parents during Covid. If they fall into wrong hands, they may become victims of child trafficking. NGOs and local administration need to work closely to provide help to these children. The government must ensure that not only free foodgrains are made available to these families but also sustainable jobs so that they are not compelled to push their children into the labour market.

Noida

One of the root causes o fchild labour is the twin evils of poverty and unemployment, and the pandemic has aggravated the problem. The government should, therefore, pay more attention to economic growth and development which will automatically reduce child labour to a great extent.

The government must work in unison with NGOs to tackle child labour. The spread of education in backward areas, opening counselling centres for children/parents, and providing employment opportunities by opening labour-intensive industries will go a long way in reducing child labour.

Thane

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