A Scam Even Worse Than The 2G Scam

The Modi Government prevented the environmental activist Priya Pillai from flying out of India, branding her ‘anti-national’ for seeking to discuss concerns about MNC plunder of adivasis’ land and destruction of the environment.

But the same Government has just facilitated the super-rich Vijay Mallya in fleeing Indian shores to avoid paying his massive debts to public sector banks and evade criminal charges of money laundering.

The police issued ‘lookout notices’ to Ms Pillai and to two JNU students facing ‘sedition’ charges. But the CBI under Modi ‘modified’ the original lookout notice seeking Mallya’s detention at the country’s exit points, instead seeking only ‘information’. For the Modi Government, then, dissenting students can be treated as dangerous criminals and arrested, but corporate scamsters are given a free hand to plunder the country and then go scot free to evade justice. Mallya’s company Kingfisher called itself ‘The King of Good Times’ – and indeed Modi’s promised acche din has materialized for the likes of Mallya and Ambani alone.

Another notable contrast is between how different categories of loan defaulters – depending on whether they are poor farmers or corporate cronies of the Government – are treated in the country. Farmers who take loans of modest amounts and fail to repay them are hounded and humiliated by the police and loan recovery agents – resulting the suicide of some 15000 farmers every year. But Mallya, who owes public sector banks upwards of Rs 9000 crore, is allowed to flaunt his lavish lifestyle of yachts, parties and private islands, and simply quit Indian soil rather than life itself.

Both the UPA and NDA Governments promoted cronyism, forcing the public sector banks to bear the burden of the unpaid debts of the Mallyas, Ambanis and other corporations. In 2010, when Mallya’s Kingfisher airlines was heading for a crash, the UPA Government facilitated a safe landing, with a debt-restructuring agreement. Mallya handed over goodwill and trademarks of the Kingfisher brand to the public sector banks as security in the event of non-payment of dues – but today, the brand value of Kingfisher has plummeted and the banks are unable to find buyers! In 2015, the Modi Government facilitated a debt restructuring agreement for Mukesh Ambani’s Reliance Gas, allowing it to repay its massive loans to public sector banks by 2031 instead of 2019!

These corporate bailouts combined with a larger economic slowdown, have precipitated a banking crisis in India, with Non-Performing Assets (NPAs) of banks surging to 17 per cent in the past couple of years. A report of the Credit Suisse titled ‘House of Debt’, has listed the 10 most indebted corporate houses in India – Lanco Group, Jaypee Group, GMR Group, Videocon Group, GVK Group, Essar Group, Adani Group, Reliance ADA Group, JSW Group and Vedanta Group – pointing out that the bulk of these unpaid debts are owed to public sector banks.

These unpaid loans point to a scam even larger than the 2G scam. Rs 1.14 lakh crore – amounting to 40% of corporate bad loans – have been written off during the last three years (2013-15). According to the India Ratings Report, a further Rs 52,227 crore is expected to be written off in the financial year 2016 – taking the total up to 1.66 lakh crore. This does not count the huge loans which have been ‘restructured’ to delay repayment periods or slash interest costs. RBI governor Raghuram Rajan pointed out that “this money would have allowed 1.5 million of the poorest children to get a full degree from the top private universities in the country, all expenses paid.” Imagine, then, how many degrees from public universities this amount could have funded? Yet, the BJP machinery brands subsidies to JNU, where a substantial percentage of students are from socially, economically and regionally deprived backgrounds, as a ‘waste of public funds’, while presiding over an open plunder of public funds by crony capitalists!

The phenomenon of crony capitalism extends also and especially to crony ‘godman’ businesses – where godmen close to Governments, like Asaram, Ramdev and Sri Sri Ravishankar are allowed to flout laws with impunity. Recently the Modi and Kejriwal Governments have together allowed the godman Sri Sri Ravi Shankar and his Art of Living organizations to organize a massive extravaganza on the banks of the Yamuna, irreversibly destroying the fragile riverine ecology and grabbing land forcibly from Dalit peasants. Sadly, even the National Green Tribunal and the courts, while noting the illegality and the damage, disciplined and restrained themselves rather than the offenders. Instead of putting a stop to the Ravishankar extravaganza, the NGT merely imposed a fine to ‘compensate’ for the damage – of which Ravishankar arrogantly refused to pay a paisa.

Why are the public sector banks not declaring the names of serial offenders in terms of unpaid loans – and the pending unpaid amounts? The country deserves to know the amount stolen from the public banks and the names of plunderers – and the Government must be made to answer for this loot. Crony capitalists and crony godmen cannot be allowed to practice the ‘Art of Cheating’ and the ‘Art of Looting and Leaving’ India.