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Stand-still recoveries
This refers to ‘Settlement scheme for loan defaulters on cards’
(Nov 13). The first phase of the One Time Settlement scheme
for bigger borrowers is nearly over and hence the government
has turned its attention to smaller borrowers. But the recoveries
will be peanuts compared with those arising from bigger borrowers.
Bank recoveries have virtually reached a stand-still now. This
is the right time to pay attention to the law of insurance and
law of damages. All businesses face risks. Insurance companies
should introduce plans for business failures and ‘no fault’
insurance. Project appraisers should insist on such provisions.
The Reserve Bank should caution banks and financial institutions
about the imposition of damages for breach of statutory RBI
guidelines. If such essential conditions are not created, entrepreneurs
will not be attracted to new business propositions.
— Ram Kishan, on e-mail
II
In response to the finance minister’s statement that banks
ought to take big defaulters to court, it is suggested that
the legal framework and procedures be streamlined with regard
to those who’ve defaulted on bank dues, with particular reference
to willful defaulters. It has been seen that, at times, the
promoters become rich while their companies become sick bringing
down the lending bank along with it. If the government is
serious about ensuring recovery of bank dues, the legal process
has to act as a facilitator to the banks, rather than to the
defaulters, who currently tend to drag banks in to long-drawn
litigations.
— R S Raghavan, on e-mail
Sebi’s moves
It seems that the Securities and Exchange Board of India is
keen to boost stock market sentiment and, hence, has made two
decisive moves to bolster the sagging growth of stock markets.
Just a fortnight ago, the government had allowed companies to
buy back up to 10 per cent of their equity capital without shareholders’
permission. This will help promoters to increase their shareholding
in companies indirectly.
In another recent move, Sebi allowed the creeping acquisition
limit of promoters to be raised from five to 10 per cent. This
would only mean that promoters can now keep on buying shares
of their company till the 10 per cent limit is reached without
‘triggering’ the take over code. One wonders whether Sebi’s
moves of extending protection to Indian promoters go hand in
hand with a liberalising economy?
— Satish Murdeshwar, on e-mail
Gift parking slots
This refers to the feature ‘Car makers line up freebies for
consumers’ (Nov 16). Parking is getting to be a nuisance in
metros. Cars get towed away from even authorised car parks,
parking attendants cheat car owners by overcharging, and there’s
a paucity of parking lots. I suggest that parking lots be managed
by different car manufacturers. They ought to provide free car
parking for their own makes, and could charge a nominal fee
for other brands of cars. In turn, they could pay some amount
to the concerned government authorities. This would be a good
way to beat the competition.
— Mahesh Kapasi, on e-mail |
