There are several readers here and several million outside who are very much dejected by the loan waiver move of the government. And there are several million who, though supported the scheme either wholeheartedly or for an argument sake, are convinced that as a whole this scheme is detriment to the Economy. The Fact is Far Far away from these all.
This move will Bring into the Economy a whopping 5% of the ENTIRE BUDGET. That too with in a span of 3 MONTHS !!!
Firstly, by offering a waiver of OVERDUE loan of small and marginal farmers, which has already been provisioned for in all these time by Banks, by stricter dictation by the Reserve Bank on the entire financial spectrum, the burden on the economy will practically be marginal, if at all it is.
When he said the same for other farmers, his raider was that they deposit 75% of the OVERDUE amount, and not the DUE amount, he is in fact bringing in that 75%, which would otherwise have already been considered by these poor Public Sector Banks as LOST. By provisioning Rs. 10,000 Crore that was there already, he is targeting to get Rs. 30,000 CRORE, which he was hopeless to recover from those farmers anyway. A net gain of Rs. 30,000 Crore. These, otherwise capable farmers, will get the money from whatever source that are available to them. This money would have been remaining untapped eternally.
Would You say now that Chidambaram is a dumb fellow?
RE:Loan Waiver - A Cleaver Move
by Kaandy on Mar 01, 2008 01:29 AM Permalink
Yes. He is a dumb as your theory is. I myself am a economist and I know this is baseless theory. Please study the economics correctly before making such assumptions.
Kaany, you should counter my argument instead of telling that it is base less. An Economist will never do this.
And I am telling you, this is exactly what the FM was thinking on loan waiver.
Tell me first, as to from where he is proposing to get the money. Has the FM told as to where he would get this money from?
Secondly, tell me as to what the RBI's guidelines for Bad Debt and what has been the consequence of such measure in all these years. Tell me as to how these bad debt was provisioned. If you do not know, ask a banker. Have the Banks waived all these money themselves? Or are they asking those borrowers to pay back?
You are telling this is a baseless theory. A theory nonetheless, is not it? What is your theory?
What is your own analysis is on it? I am sure you have none.
And please tell me as to how I will accept as my analysis is wrong. Just because you told so?
