‘Relief to biggies, small players taken to task’

Shivani Bhakoo

Tribune News Service

Ludhiana, July 16

To settle finances with the defaulters, major relief is being given to big industries by the banks, but as far as small borrowers are concerned, they are asked to pay the penal interest after their units turn bankrupt.

The large Non-Performing Asset (NPA) companies are getting extensions for years, whereas on the other hand, the banks start the recovery process with small borrowers in no time.

Badish Jindal, president of the Federation of Punjab Small Industries’ Association (FOPSIA) said: “Due to the vested interests, banks try to hide the names of big industries, but highlight the names of small borrowers. Big industrial houses with a debt of several thousands of crores have already siphoned off money by making other investments in India and abroad. Recently, banks in Ludhiana have started the recovery procedures against big companies with a turnout of over Rs 10,000 crores, but the banks will merely recover anything from these companies.”

An official of a leading bank here said there were several companies, who had to pay over Rs 10,000 crore to the banks. These companies had already approached leading lawyers. “We, therefore, expect a little in the name of recoveries,” he said.

“Recently, a loan of Rs 250 crore was settled at Rs 75 crore by a bank in Mandi Gobindgarh, whereas, a small borrower, residing in Dugri area, was forced to pay even the penal interest as his company turned bankrupt. Similar treatment should be meted out to both big and small borrowers,” he said.

Arun Behl, a retired banker-cum-Head of the financial services of FOPSIA, said in a small city like Ludhiana, Rs 10,000 crore NPA crossed only because of connivance of banks and big companies.

The major NPA sectors in Ludhiana are textile, yarn, hosiery, steel, bicycle, fasteners etc. The yarn and textile contributes around 70 per cent of the total NPA. Even the RBI has declared a few companies as NPA.

“FOPSIA has already requested the Prime Minister to conduct a CBI enquiry on all defaulters above a certain limit as many owners have purchased big assets in Canada, England, Australia and Dubai. These NPA players are the main buyers of all high-end cars, jewellery and other luxurious items. But, for repaying loans, they become defaulters,” said Jindal.