This refers to ‘PSBs: Privatisation’s not the way to go’ by Bandi Ram Prasad (March 1). The arguments are not convincing. From 1985 to 2017, the Government infused capital worth ₹1.5 trillion in PSB. This is a drain on taxpayers’ money and reflects inefficiency. PSBs collectively account for more than 80 per cent of gross NPAs. Most are wilful defaulters.
Globally there could be isolated cases of government owning PSBs but by and large the model is private holding of banks. PSBs have contributed to most number of frauds. Hence to prevent loan losses, improve quality and for effective management governance devoid of political interference, PSBs need to be privatised.
Srinivasan Velamur
Chennai
The two important points are that the number of banks is large and they need to be privatised.Reducing the number of banks is not practical since the workload and handling will be seriously affected. As for privatisation, it is worth examining whether the huge cash transactions could be left to private companies to handle in an efficient manner and the profit lost to government could be taken care of.
TR Anandan
Coimbatore
As all scheduled banks are under the control and supervision of the RBI, the policies and priorities of the Government can well be implemented by these banks. But there is a perception that PSBs are not serious about their recovery initiatives and hence they can be taken for granted by defaulters.
If private banks suffer from NPAs only a small bunch of stakeholders will be affected, not the majority of the population. We need to see the larger canvas rather than the micro benefits.
B Venkateswaran
Chennai
It was the nationalisation of banks in 1969 and subsequently in 1980 that paved the way for structured banking in India. This increased the confidence of the peoplein the banking sector and made it the mainstay of the economy. During the 2008 recession, these banks that kept the Indian economy going. These are the pillars of the Indian financial system and if anything is to be done t is improvisation, not privatisation.
Siddharatha S Bhardwaj
Kurukshetra, Haryana
Political nexus
The arrest of P Chidambaram’s son in connection with the INX Media case is a blow to the Congress, especially when it has been launching scathing attacks on the BJP over the PNB scam. Expectedly, the Congress calls it political vendetta.
There seems to be an unwritten understanding between the two not to use the CBI against each other seriously, whereas the leaders of regional parties could easily be harassed using the central agencies. It is high time the CBI and other agencies were given more autonomy to investigate corruption charges freely.
Buddhadev Nandi
Bishnupur, West Bengal
Auditing auditors
This is with reference to the editorial ‘Minding the watchdog’ (March 6). Pitching for an independent overseeing body is a good idea, even though the ICAI is opposed to it.
Viewed from the angle of number of financial irregularities and scams getting unearthed, normal auditing practice needs to be changed to a forensic type audit practice. Apart from rotation of audit firms, the partners in charge of a particular audit should also be changed. Auditors should assume not only greater responsibilities but also ensure their absolute independence. Even when a company adopts time tested accounting standards like GAAP and international accounting standards (IAS), what ultimately matters is the people who manage, administer and oversee them.
RS Raghavan
Bengaluru
It is time we had an independent body akin to PCAOB in the US, in India. However, care should be taken not to exclude ICAI’s expertise in the process. There is also a need to sustain the quality of CA education. There was a massive operational error in declaration of the CA results in January 2018.
Bharan Kumar
Mumbai
LETTERS TO THE EDITOR Send your letters by email to bleditor@thehindu.co.in or by post to ‘Letters to the Editor’, The Hindu Business Line, Kasturi Buildings, 859-860, Anna Salai, Chennai 600002.