Bad loan write-offs
Apropos ‘Banks wrote off ₹14-lakh crore of bad loans between FY15 and FY23’ (August 8), it is surprising that such a huge amount has been written off by scheduled commercial banks in a span of just eight years. And out of the total write-offs, more than 50 per cent constitute bad debts relating to large industries and services.
No wonder that the gross non-performing assets (NPAs) have plummeted during the period. If the amount written-off is added (notionally) to the current gross NPAs, the current “real” status of NPAs would be alarming.
Though it is true that borrowers of written-off loans continue to be liable, the prospects of such recovery appears to be bleak, given the fact that amount recovered in written-off accounts during the above period is hardly inspiring. While various recovery mechanisms, including IBC, exist, it is common knowledge that the actual recoveries in written-off loans tend to be very low, especially because the value of assets would have deteriorated vastly by the time the recovery mechanisms are activated and the recovery process comes to fruition. NPAs can be minimised only by tightening the credit appraisal, monitoring and reporting mechanisms at the micro level.
Kosaraju Chandramouli
Hyderabad
Measuring poverty
This refers to the editorial ‘Chasing a mirage’ (August 8). Previously, poverty was measured in terms of dearth of food, shelter and clothing. But now, multidimensional poverty includes more parameters like health, drinking water, sanitation and cooking fuel.
NITI Aayog, which has released the multidimensional index on poverty, has made some private goods as public goods and treated some items as basic essentials of life.
As a welfare measure and a vote-winning strategy, political parties keep expanding the ambit for measuring poverty.
NR Nagarajan
Sivakasi, TN
Weather worries
Apropos ‘Erratic weather to brew early Arabica harvest this year’ (August 8). Estimates of deficit rainfall in the August-September period and possibility of rains during the retreating season, are a source of worry not only for Arabica coffee planters but also paddy farmers. Hopefully, the government has a plan to bail out farmers financially.
Rajiv Magal
Halekere Village, Karnataka
Handloom products
This is with reference to ‘Handloom sector played a key role in reducing poverty’ (August 8). The Prime Minister is right in asking people to buy handloom products during the upcoming festival season.
By taking certain measures, the khadi industry can be saved and employment opportunities, created.
Various khadi products should be popularised on social media such as WhatsApp, Twitter, Facebook, etc. However, the weavers may not be aware of these channels, and hence it is the duty of the government to assist them in finding new markets. This work can also be assigned to students of government-run business management schools or CSR schemes of companies.
The weavers should be encouraged to sell their products online by educating them about the Internet, e-commerce companies, and other modern means of selling..
Once a good market, both overseas as well as domestic, is created for khadi products, the weavers need not depend on middlemen and can directly sell their wares, increasing their profit margins in the process.
Veena Shenoy
Thane