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Going solo makes sense
This has reference to the news item ‘SBI to go solo in corporate
finance’ (Dec 31). The decision of the State Bank of India
is a reflection of ground realities. Even consortium banking,
which was a forerunner to multiple banking, has been an utter
failure inspite of the apex bank. Despite several statutory
Reserve Bank guidelines, public sector banks never bothered
to abide by them as the RBI never imposed any penalty. The
consequences have been huge numbers of litigations, counter-suits
and counter-claims. The matter will have to be decided by
the judiciary.
Basically, consortium or multiple banking results in divided
responsibility or nobody’s responsibility. Under these circumstances
and given past results, SBI’s decision needs to be welcomed
by corporates. It is also expected that other banks will follow
suit. The RBI may amend guidelines suitably.
— Ram Kishan, on e-mail
Costly donations
It is understood that a bill has been passed permitting political
parties to accept donations from corporate organisations by
way of cheques and drafts. While no limit has been set for individual
donors, corporate donations are subject to a maximum of 5 per
cent of the average annual net profit for the last three years.
Though this appears fine, it is possible that politicians may
accept cheques/DDs and return cash as is routinely done by many
businessmen. This is another way of encouraging growing black
money and hawala transactions.
Political parties are not engaged in carrying out charitable
work, and politicians are already getting fat salaries and perks
etc. So, they must spend their own money and not burden the
exchequer. Even if corporate houses give donations, they will
extract more than the value of donations by increasing the prices
of their products and services, which will end up affecting
consumers.
— B S Ganesh, on e-mail
(In)credible NGO
The recent Ahmedabad court order asking the Centre to look into
and consider initiating action against the Narmada Bachao Andolan
for violation of income tax and foreign exchange laws is truly
welcome. One wonders how the entire pattern of working of non-governmental
organisations has changed over the years. During our days, NGOs
would work selflessly for years without ever being noticed by
anybody or being quoted by the media. In fact, there were quite
a few of them who were reluctant to about the good work that
they are undertaking. Now one sees and reads about NGOs whose
media presence can well be compared with that of leading Bollywood
film stars. NBA, of course, leads the way thanks to endless
dharnas and fasts all over the country.
Wonder how these NGOs raise funds to run such high profile institutions
with elaborate websites that match those of leading corporates.
With this court order it’s clear that there is a link with foreign
funding agencies, which fund such NGOs without really understanding
the problems at the grass root level. When we talk about serious
things like power projects and dams, the funding agencies should
look into the issues more carefully. One cannot but support
this public interest litigation of the National Council for
Civil Liberties.
— Kinnari Shah, on e-mail |
