The problem of Non-Performing Assets (NPA) or bad loans, particularly of public sector banks (PSB) shows no sign of abating. The NPAs of Indian banks are now reported to be the fifth highest in the world. International agencies like the IMF have expressed concern that the bad loan problem of Indian banks could come in the way of India’s growth.
The scandal involving the Punjab National Bank, numerous other Indian banks and diamond businessmen Nirav Modi and Mehul Choksi has once again brought the crisis of the banking system to the centre-stage of public debate.
The ruling class wants to exploit this particular scandal which involves public sector banks to push the erroneous and dangerous notion that privatization is the way to lift the banking system out of crisis. As far as the working class and broad masses of people are concerned, the problem is that both public and private banks are not fulfilling the function which the people expect from them. They are not protecting the hard-earned savings which people have deposited with them. Far from protecting such deposits, banks are colluding with capitalist profiteers to loot the people!
After enacting a law to deal with insolvency and bankruptcy of non-financial companies in Dec 2016 (Insolvency and Bankruptcy Code, 2016) and creating a regulator, Insolvency and Bankruptcy Board of India, the Modi government has now proposed a bill to deal with the failure of financial institutions, Financial Resolution and Deposit Insurance Bill, 2017 (FRDI Bill).
On 24th October, Finance Minister Jaitley announced that the Government of India plans to spend Rs 2,11,000 crore over the next two years to “recapitalise” the public sector banks. Under the Indradhanush plan announced in 2015, the government had announced that it would infuse Rs 70,000 crore of capital into the government owned banks over four years. Two years later, the capital to be put into the banks has risen by nearly three times.
Mazdor Ekta Lehar (MEL) spoke to Comrade JP Sharma, Vice President, All India Bank Employees Association and General Secretary, Delhi State Bank Employees Federation. Comrade JP Sharma (JPS) expressed his views on the current situation in the banking sector and the struggle being waged by the bank employees.
Economic news during the month of February was dominated by various reports of Indian banks facing a major problem due to a steep rise in “non-performing assets”. Side by side, there has been repeated coverage of the pre-budget debate, dominated by a so-called dilemma of striking a balance between the need to accelerate “growth” and the need for m
The Report to the Fifth Congress of the Communist Ghadar Party of India, presented by Comrade Lal Singh, General Secretary of the CGPI, on behalf of its Central Committee, was discussed and adopted by the Fifth Congress of the CGPI, held in November 2016. By decision of the Fifth Congress, this report has been edited for publication.
The first part of this pamphlet is an analysis of facts and phenomena to identify and expose the real aims behind the Note Ban. The second part is devoted to a critical appraisal of the government’s claims that it will reduce inequality, corruption and terrorism. The third part is what Communist Ghadar Party believes is the real solution to these problems and the immediate program of action towards that solution.