Letters

Letters to the editor dated September 27, 2021

| Updated on September 27, 2021

Monetising govt assets

Apropos ‘Why asset monetisation imperative’ (September 27); NMP for about ₹6 lakh crore envisaged by the DIPAM and NITI Aayog is a good means of mobilising the much-needed resources to revive the economy from the pandemic blow. However, the think-tank should ponder whether time is right for this initiative given how the disinvestment target is reported to have been met only three times and that too only after drawing up revised targets starting from 2014-15.

About 13 asset classes have been delineated for this mammoth project and all are of strategic national importance covering roads, airports, railways, ports, power, gas pipe lines, telecom etc. The enormity and capital intensity of each class inhibits small players from bidding.

This may result in just two or three players placing bids, leading to the potential of cronyism and nepotism.

Then to bring in a fair-value realisation, global players have to be roped in which has its own strategic and security vulnerability.

Given the resource constraints of the government for infrastructure development and the indispensable need for it, the government after addressing all the likely issues, will move pragmatically given how high the stakes are.

Roy Markose

Thiruvananthapuram

This refers to an article titled, ‘Why asset monetization is imperative” (September 27). The basic question is this: what are the public sector or government assets to be monetised? If assets are in the form of land, then the question is this: are title deeds of the land clear? Past experience tells us that in our country land records are not reliable and there is a huge scope for challenging land ownership. Digitisation of land records has not been done and it is possible that original owners whose land was compulsorily acquired for an insignificant price would use all legal means to challenge the process of monetisation.

In the case of movable assets of the public sector, the question is this: will someone be interested in utilising such assets for a commercial purpose? Will such an exercise be a viable enterprise?

There is a need for a debate.

CA Narendra M Apte

Pune

Need for Indian solutions

The Finance Minister’s recent remarks on bank mergers are causing concern. While overlapping of public banks in an area can be avoided by shutting down some of them, this wholesale mergers are uncalled for. Expecting big banks to be nimble and agile is not right. Indian banking cannot rely on models of other nations. Indian banks need Indian solutions.

It is extremely unlikely that the areas which do not have brick and mortar banks will have the infrastructure necessary to carry out digital banking.

Those not very conversant with digital banking are likely to be duped by cyber crooks. When many of the bank customers in rural areas need the support of the bank staff to fill up cheques and pay in slips, how can the Finance Minister even think that the solution to unbanked or under banked areas is digitisation?

Anthony Henriques

Mumbai

Bad bank is not the solution

With reference to the article ‘Bad bank will merely camouflage NPAs’ (September 27), the writer is certainly right that the concept of Bad bank will not solve the problem of mounting NPAs of public sector banks (more than ₹2.00 lakh crore). It will only change the external cover from one basket to another. This will certainly give more liberty to banks for being unaccountable for the losses because banks are provided with an umbrella to transfer the NPAs to National Asset Reconstruction Company Ltd.

More so, when the banks are unable to recover loans, it is doubtful as to how a third party such as the new NARCL would recover them. It seems the main intention of the government is only to make available surplus funds in the banking system for lending under different sectors. But mere lending will only increase the NPAs and transfer the headache from one place to another instead of firmly dealing with wilful defaulters and putting them behind bars.

Katuru Durga prasad Rao

Hyderabad

Published on September 27, 2021

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