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3:11 pm - Tuesday November 22, 4738

AIBEA hails move of central govt of recapitalising public sector banks

Agencies, Aurangabad

All India Bank Employees Association (AIBEA) today welcomed central governments initiative in recapitalising public sector banks. Devidas Tuljapurkar joint secretary of AIBEA in a statement said that we hailed the decision of the government, but raised some serious concern stating that corporates are either stuck up after becoming NPA or are scared to invest due to adverse economic conditions.

In retail, demand is not picking up since employees from organised and unorganized sector are being thrown out of employment or their wages are drastically reduced. No new employment is taking place. MUDRA, Make in India and all such initiatives are not yielding results.

Those are slogans only. All statistical claims are tall claims generated through abuse with the data. Farming sector despite debt relief continues to be in distress, he said. Recapitalization is to bail out banks which are in crisis due to huge corporate NPAs and write off of their debt, he said.

Thus this burden is being shifted to common man since recapitalization money is being raised by the government through internal borrowings by issuing bonds. This may result in increasing budget deficit and in turn inflation.

Servicing of those bonds i.e. payments of interests orits payment on due date is possible only through budgetary provisions by levying additional tax or raising money again through internal borrowings. It means this recapitalization ultimately results in cross subsidising big corporate by the commen man.

What about restoring interest rate on Saving bank deposits or reduction in the service charges or reduction in interest rates on retail loan, he questioned. Why government won’t resort to tough measures against big corporate defaulters? Why huge write off in corporate debt, he questioned.

Thus AIBEAs slogan People’s money for Peoples Welfare is most relevant which is tag line of National Banking Conclave being organised by AIBEA on November 19 and 20 at Mumbai, he added.

 

Posted in: Business

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