Helping banks to recover
This in reference to the report “A widening profit gap” (FE, November 10 ). Thirteen private sector banks have out-stripped the profits of 25 state-owned banks for the Sept 2015 quarter points to the urgent need for radical actions to escalate the operating efficiency of these banks. The rise in stressed assets of all public sector banks, except in the case of few, points to the need for revamping and further strengthening the current system of monitoring of big-ticket loan accounts, particularly those pertaining to the sluggishly-growing sectors, to distance banks from sudden surprises. The government, on its part, must look for implementing radical actions to ensure the uninterrupted execution of the infra projects, including the stalled projects. While the banking regulator has already implemented many measures to enable the banks for restructuring and refinancing projects, no improvement in asset quality is visible. The Ujwal Discom Assurance will pave the way for sizable reduction in the NPAs of some banks. The passage of the proposed new bankruptcy code would be of much support to the banking industry in recovering debts without delay. Revisiting various prevailing systems of banks for regulating, monitoring, and managing recovery of bad assets and written-off accounts needs drastic reforms and performers must be suitably rewarded.
VSK Pillai, Kottayam
Road ahead for Modi
This refers to the edit “Post -Bihar reforms road” (FE, November 10). In his singular quest to replicate the model of absolute administration of Gujarat, where systems and institutions were subordinated to his state agenda, prime minister Narendra Modi reckoned the Rajya Sabha arithmetic as a lone hurdle in governing India when he moved to Delhi. That made state elections far larger than life for him. With an empowered PMO overseeing the bureaucracy and most ministers, a borrowed cadre from the parivar doing the footwork, and a party chief willing to tread untested political waters, the PM was able to find ample time for his famed oratory and no-holds-barred election campaigns, big and small. A setback in Bihar may do little to change his political and administrative mindset and may well make his resolve to pursue his avowed tenets greater. One would wish it does, else we are back to the old ways of a metered progress that has remained inadequate in these increasingly globalised economic environs. For a significant breakthrough, both leaders and people must, at times, walk through fire. This time as is as good as any other.
R Narayanan, Ghaziabad