Adv. M Profile picture
Jun 9, 2018 20 tweets 5 min read Twitter logo Read on Twitter

Let's talk about NPAs :

On 8th April 2004, Soli J.Sorabjee, the then Ld Attorney General, arguing for Union of India, convinced a Constitution Bench of SC to uphold the Sarfaesi Act, 2002 by citing a pressing need to curb NPAs, which had risen to Rs. 1 lac crore
It was submitted before the SC that the enactment of RDDB Act, 1993 & establishment of DRTs has been unable to stop the rise in NPAs. Mr. Salve chipped in with a talk on International practices.

The SC agreed. A harsh, draconian law was upheld.
It was upheld with a stated objective of "reducing" the NPAs. A lot of existing protections under laws & principles of natural justice were allowed to be trampled by banks and financial institutions to address the pressing need of 'reducing the 1 lac crores of NPAs'.
Fast forward to 2018 : On 9th March 2018, Mr. @DeependerSHooda put forth a Q in Parliament on NPAs.
Mr. Shiv Pratap Shukla ... You will be like ........ Errr who's that dude ??

Well the dude is MoS Finance, he gave a figure of 8.26 lac crores. Eight-fold rise from 2004

Now that we are in June 18, the figure for Match 2018 is said to be 10.25 Lac crores.

Ten-fold rise since the SC was tricked into upholding a draconian law. Then why did the NPAs rise ? Is it spread evenly over the years between 2004 - 2018 ???…
This study claims that as on March 2013 the NPA figure was 1.13 lac crores & the Net NPA ratio was 0.52 % with 62.39% provisioning.
(Read & memorize these figures)

It means: for 11 long yrs NO INCREASE IN NPAs.

Who was PM?

Dr. MMS.

Now say sorry to him for abuses

But didn't the nation outrage over massive corruption under Dr. MMS ??

Yes, it did.

But didn't people worship Assaram & Love charger Baba??

Didn't they hail Anna Hazare as next Gandhi ? Ramdev as a crusader?


Don't trust me. Let's evaluate the evidence.

The allegation in 2G was about preferential treatment given to some shady operators in spectrum allocation by A.Raja, then Telecom Min. The CAG came out with an outlandish theory of 'presumptive loss' of 76k crores to the exchequer due to direct allotment as agnst auction
The CAG theory has been shown the dustbin by a Court. And that's besides the topic of this thread.

As a common man, did u not see the benefits of low priced spectrum ? Has it not achieved the objective of increasing tele-density?

Doesn't your maid & driver hv a cellphone?

The story of Coal G is being left for discussion on another day.

BTW, not a single UPA Minister is being prosecuted on "corruption" charges as on date.

So the "massive scale corruption" during UPA is better suited for WA University for consumption of Bhakts.

Sorry for the digression.

Coming back to the NPAs:

Year 2013-14. The media cried hoarse over 'policy paralysis'. Hope u remember that one. Every Anchor, every pink paper shouted from roof-tops.

Was it also a hoax ?

No. Only a motivated, dishonest exaggeration.

The NPAs tell the story of 'policy paralysis' too.

BY March 2014, the NPAs had risen to Rs. 2.85 lac crores. Nearly by Rs. 1.72 lac crores.

It means the government was NOT dealing with the economy but dealing with the sundry Babas by meeting them at airports etc

Dealing with the idiotic demands of a motley bunch of rabble rousers sitting at Ramlila Maidan & a cacophonous, ballistic and belligerent media. Ably supported by arm-chair critics like PBM etc.

Governance was in shambles.

The economy suffered. NPAs rose sharply.
Then India elected a Messiah. A Messiah of 'phree-market'. Of "development'. A strong decisive leader. The Dhumes, Tavleens, Bhallas & Jaggis pronounced a bright economic future. The Rupa Ben couple heralded earth-shattering eco reforms.

What did the NPAs say : March 2015 : within one year rule of the Messiah, NPAs rose to Rs. 6.40 Lac Crores from Rs. 2.85 lac Crores. It means that the economy was still faltering even while the nation was made to believe the absurd claim of the Messiah.

Then the Messiah struck a lethal blow to the economy. #NoteBandi which he fraudulently called as #DeMonetization. He was able to sell it as a war on so many things & win an election. A crime of monumental proportions was sold as a 'saaf-niyat' stuff. .

Buoyed by the electoral success & relying upon the voices in his eco-chambers, the Messiah rolled out a flawed GST where implementation was nothing but a horrible mess. Small businesses & SMEs received a brutal jolt. Longstanding units were on the brink of closure
Agriculture, Textiles, Constructions, Exports, Services Land prices ....everything went tumbling down due to the double whammy.

All that is reflected in NPAs. BY March 2018 the figure is 10.25 lac Crores.
TEN times of what Mr. Sorabjee had used to convince SC to uphold Sarfaesi Act, 2002

I'll continue this thread to focus on the issues related to banking, DRTs, IBC etc & their contribution in rise of NPAs

Till then ....enjoy the rains.

Enjoy the weekend.

PS :

The hypothesis is that : good governance & a buoyant economy is the best anti-dote to NPAs. Entrepreneurs aren't dishonest. They don't fail. The businesses fail. And more often than not, due to reasons beyond their control.
Ex: Note-bandi & flawed, under-prepared GST

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Oct 20, 2017
1/ Just finished meeting with a Dhule based SME entrepreneur who's "finished" due to #DeMo aka notebandi. Also insensitive bankers.
2/ The gentleman is a third generation onion trader. Uses to be a Really big trader. He allowed his son to set up SME for onion dehydration
3/ Being in onion business, he knew his onions. So a state of the art , modern manufacturing plant was set up, part funded by bank.
Read 12 tweets
Sep 28, 2017
#GSTGaming tales I continue to hear :
Visited a CA (doesn't want to be named) in Kalbadevi y'day:
1. CAs r advising clients to deal in cash
2. They say it's impossible for many businesses to continue with GST.
3. High value cash deals have started featuring Gold biscuits as
as part of the deal. Payments are being made partly through Gold. A few biscuits & a few lacs in 2000 denominations.
Read 6 tweets

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