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Category: Current Affairs

Non-performing loans of public sector banks as a MAJOR vehicle to loot and destory India

A comment received by AV Raju, here. I’ve had to extract it in Word and reformat it, in order to be read it. I am extracting key points below, along with my comments in blue.

This comment by Raju provides a key insight into the role played by public sector banks in the loot of India.


It is reported that the Indian Steel Industry has borrowed to a tune of 4 lac Crores from the Banking System and of this around 75% of it is NPLs. If this is in One sector how about Power, and textiles and infrastructure and real estate?

What is the indebtedness of a common citizen of the country? When would he pay? How did this come about?

Initially there was a factor of irrational exuberance when the lenders were upbeat about the growth of the Steel Industry and that India which is a tiger economy- as opposed to China ( a dragon economy). That the Steel industry is the one that has the potential and visibility to grow manifold considering that the national production is below 80 mn tonnes as against the Chinese production of nearly 700 mn, offering great scope to grow our infrastructure, and consequently our per capita steel consumption, which in 2008 was one of the lowest in the world.

… I am sure the vast majority of the NPLs have been contributed by those Corporates who chose to make their own hay while the sunshine of inaction [during UPA] seemed a very viable alibi. Should not the inaction be brought to justice.

The Bureaucrats have also paid a price and in the broad-brush enquiry many a honest officials and Bank officers are subject to enquiries followed by punitive actions. The Corporates have gone on to grease the new formations and forge alliances with new teams to further their designs to ensure non-payment and to canvass and press for a deep haircut of the existing exposures, citing restructuring of the loans taken by them as the only viable means of coming to terms with the basic economic reality present in the country. Who pays for it?

Consider the case of a small borrower who defaults and goes for a OTS. I have been a banker. In one case the Autorickshaw lent to the borrower under Govt sponsored schemes, originally lent under the pressure of targeted lending, was sold by the borrower within a week of its disbursal and the proceed was used up by him for consumption loan (to perform his sisters marriage).

There was a hue and cry and I roped in the police to have him taught a lesson. But he stood the ground. I felt weak at the protection available to him under the guise of weaker section, humiliated that I am unable to recover public fund entrusted by many pensioners to my care for a nominal interest.

But then, the money, perhaps recapitalised by the Govt later on, has never left the shores. It is the tax payer who has paid for the borrowers sister’s marriage and so be it. It has contributed to economic growth after all.

What about the situation of the national taxpayers wealth being paid to compensate for the wealth that has gone under the carpet never to see the light of the day, converted to assets determined in foreign currencies, never to be used by the nation and ensured to be churning the economy of another nation, even probably an enemy nation. What about the erosion in purchasing power of every individual Indian and the cost being paid by the nation due to depreciation of the rupee. [Sanjeev: this is a very valid point]

It is a huge marriage of illicit interests driven by the sheer ambition of making easy money, with an utter abandon of ethics, principles and patriotism. It is a cumulative effect of all the ambition of all the players in the game of making easy money, with carefully minimised risk of getting legally cornered, while the lenders who are finally to part with the money would be left alone to be tormented by the authorities within and without for not diligently reading the fine prints that purportedly absolve the consultants who are mandated to do an objective job and minimise the risk of failure.

The initial debt and the additional debt later, has been ill-gotten, far in excess of the requirement, for projects that never came up, for capex that never happened and for procuring current assets that better served easy diversion than any addition to enterprise value.

It is a corporate machination of deceit, fraud and treason perpetrated on the common taxpayer with little sense of impunity. This is well achieved by a continual call to litigation by the indebted corporates. The Corporates handed all sorts of stories that blamed the changes in the socio-economy and political scenario … to seek approvals for further leveraging, while promising return of every penny that was ever borrowed.

What is the pain that these economic offenders have caused to the nation? And what is the govt supposed to do in the absence of proper redressal mechanisms and when the Govt is soft pedalling issues, presumably careful not to irritate its own funders and interested parties in the Politics- Industry nexus? [Sanjeev: this is the key point in this article – a very important point]

What is the option left for honest Corporates trying to function in a battered system?…  But there is another option, the most regrettable one though. Stop the business, transport the business beyond the boundaries of the country, grow economy somewhere where the competition is more ethical and level, perhaps using the money pumped in by the practitioners of diversion who are now able to dollarize their rupees. [Sanjeev: this is the other side of the story: kicking out honest Indian businesses out of India]

Now the drama unfolds like this.—The Ruling class needs both the corporates, business houses,and business men for financial support largely to fund elections.

The trio of the politician, the business man and the poor-man ganging up to loot the taxpayer.

All taxes are collected and used to run the Govt, enrich the already rich to syphon monies that would never return to the economy, distributed as doles and subsidies but paid mostly by the common middleclass Indian.

This must stop and I believe there is only the SBP, who has the intellectual mettle, experience of having seen it from close quarters, and most importantly the political as declared in the manifesto to bring this menace to a STOP, as of now.

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Corruption in mining in India – $12 million from merely one transaction

Has anyone investigated this in India? This took place in 2008
Documents and key emails suggested that Thiess’ business partner in India would be paying $12 million to powerful Indian government officials – an apparently illegal payment under Australian law. [Source]
Time permitting, I’ll explore further. Any inputs appreciated.
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HC Gupta (IAS 1971 RR, UP cadre) and the Coal Block scam – preliminary analysis #2

A number of people who know HC Gupta have come out in his support. I’m not passing any judgement at this stage, but just noting some of the comments I’ve come across.


My batchmates who know him (and I’m only talking about those whose views I trust) vouch for his integrity.


“Mr Gupta is known across the state for being a humble and an upright official. The fact that he has chosen to go behind bars and not even take legal recourse for lack of funds has pained us immensely and we are trying to help him in as many ways as we can,” a principal secretary of Uttar Pradesh told IANS. [Source]

The officials pointed out that under the Prevention of Corruption Act, there was no watertight case against Mr Gupta, as there was neither intent nor a money trail. “We believe he did what is alleged to have done at the beck and call of the then PMO and he is not involved in the whole issue anyhow,” said a senior bureaucrat, not wishing to be named.  [Source]

Former Coal Secretary H C Gupta, an accused in several coal scam cases and presently out on bail, has been known among his colleagues, subordinates, and batchmates as a clean and studious civil servants who obeyed the orders of his political boss and former Prime Minister Manmohan Singh. It’s a travesty of justice that for doing what he was obligated to do as a civil servant, he has been hauled up in as many as 20 cases [Source]

“this fine bureaucrat, whom everyone unhesitatingly certifies to be “the most honest officer” of his generation” [Source]

IAS officers back ex-coal secy H C Gupta, to approach PM Modi [Source]

(Further: ‘Coalgate’: corruption, an honest bureaucrat and a deeper malaise in India)


Once again, I’m not putting out my own views till I understand this case better. I’ve asked the mining industry to advise me, as well. I may add, that prima facie, HC Gupta appears to be an honest officer.

On the policy matter, though, it is my view that the Supreme Court went overboard (and incorrectly) in their intervention into coal block allocation.

I’ve already posted about this issue (see this: Modi government’s disastrous mining policy for India. Article: Coal block auctions: A Himalayan blunder?)

And my views on Modi’s mining policy are clear: Fundamental design flaws in the Modi government’s mining ordinance

This does NOT mean I’m absolving HC Gupta of wrong doing (e.g. he may have been honest himself – much like Manmohan Singh is personally honest – but may have agreed to do the biddings of political masters whose only goal is to make money; I consider that corruption as well – even though that may not be precisely covered under the Prevention of Corruption Act).

All I’m saying is that this matter needs careful consideration of policy aspects, as well as implementation aspects. The CBI is (as is the Supremet Court) sorely ill-equipped to evaluate the policy aspects involved.


Let me elaborate how politicians actually make money. It is never the case that they make money by directly passing written orders in favour of the person who is going to bribe them. When Hiteswar Saikia asked me (when I was Director, Rural Development Assam) to give a cement contract to a particular private company, he wanted me to make all kinds of written excuses in the file to not give the contract to the lowest bidder. It would then appear that I took the decision, not Saikia. I would not get any money (since I never took any corrupt money) but Saikia would get the money and would be exempt from any direct trail to him.

I was kicked out of my job by Saikia the moment I awarded the cement contract to the lowest bidder (Cement Corporation of India).

But here’s the deal: I’d rather be kicked out and do nothing (while in the IAS) than sign things on behalf of corrupt politicians.

It is NOT good enough to not take money for oneself. Is one doing one’s job honestly? That is the question.

In the case of HC Gupta, that’s still an open question. He may not be culpable under the PC Act, but he may still be guilty of corruption in my broader definition of corruption.

Can those who know Mr HC Gupta confirm that he NEVER violated the ideals of integrity in order to appease any politician? Can he be asked to say so?

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HC Gupta (IAS 1971 RR, UP cadre) and the Coal Block scam – preliminary analysis #1

There has been a huge flurry around HC Gupta’s recent letter withdrawing his bond for bail:

Coal block allocation case: Govt should recognise honest officers, protect them, says Ex-coal secy

Jail me, I can’t afford to hire lawyers, says ex-coal secretary HC Gupta

Coal scam: Accused former Coal Secy HC Gupta seeks withdrawal of bail bond, wants to face trial from inside jail

Before I comment, let me provide his letter, below:


R C.NO. 219 2012 E 0016
CBI VS. M/s Kamal Sponge Steel and Power Ltd. And Others
U/S. 120-B r/w S420 IPC, S 409 IPC., S. 13(1)(C) and S.13(1)0) P.C. Act 198

SUBJECT: Prayer on behalf of the accused H.C.GUPTA


I submit as under:

1. I hereby withdraw with immediate effect personal bond submitted for my release on bail.

2. I have decided to withdraw the authorization letter in favor of Shri B.S Mathur, advocate, as I shall not be having any advocate to represent me from now on.
Reasons for the above decisions are given in the enclosed note. It is requested that action as considered appropriate may be ordered.

HC Gupta

1. Reason for withdrawing bond for bail

a) Let me clarify right in the beginning that whatever I did as Chairperson of the Screening committee or as secretary Coal was done with a clear conscience. Even today I firmly believe that whatever was done in allocation of the Coal Block by me was. done in the good faith with the objective of increasing the coil production. I have always maintained highest level of integrity throughout my service career. I also believe that Coal Block allocation was no scam. Screening Committee did its job with sincerity and in good faith.

b) However, I find that general impression is that it was a big scam where there was large scale corruption. Supreme Court, CBI, Special Judge and perhaps the present Government also seem to be convinced that most of these allocations were done in a manner which involved corruption and conspiracy.

c) I have been interacting with the investigating officers of CBI for last three years and have tried to explain my actions I find that despite this, in many cases they think that I am guilty of corrupt practices under the provisions of P.C. Act 1988. I have no reason to believe that they are in any manner biased against me. In fact all of them have been very nice to me during investigation.

d) I have read the order of this Court in this case by which I have been made an accused along with others. In many other cases also I have been made an accused along with others. Some more cases appear to be in different stages where I will be an accused. From the reading of these orders the Judge seems to be convinced that I am guilty of conspiracy and corruption. Again I have no reason to think that the Judge is in anyway biased against me.

e) It is true that in all these cases I have not understood the logic behind the view taken by the CBI and the orders of the Special Court. They seem to be looking for and trying to interpret the documents for prosecutable evidence rather than trying to ascertain the truth. However, that by itself cannot be the reason for me to believe that they are biased against me. They must have their own reasons for drawing their conclusions.

f) I have always tried to maintain highest level of integrity and propriety during my entire service career as also in my personal life. During the entire service career my effort has been to maintain my conduct and integrity at such a level that no one should raise a finger on my actions. Words like conspiracy, corruption, criminal misconduct or dishonest action are totally alien to me. I cannot even imagine being involved in any of such acts, yet I find that I am being accused of conspiracy, corruption and criminal misconduct by responsible organization like CBI and by the Special Judge. They allege that I misguided the then Prime Minister.

Let me clarify that I would be the last person to even have thought of doing so. These allegations are absolutely shocking — to say the least. This has persuaded me to withdraw the personal bond. I have been thinking of taking this decision for last more than one year (since the time I was made an accused in the first Coal case). It has taken me so long because perhaps I was scared of following the path which now I have decided to take, Also perhaps there was a hope that as the cases progress, the judge will realize that I have not been involved in any conspiracy or corruption. However, this has not happened.

g) I will try to explain my actions during the course of trial. However, it is quite possible that at the end of the trial the court may find me guilty. This will not change the truth as far as I am concerned. However, if that happens I would like to be punished with most severe penalty/punishment.

h) For me one approach could be to remain on bail and deal with the case in normal manner. However, my conscience tells me not to do so. I am an elderly man suffering with many diseases. It is quite possible that I may not survive the period of trial getting completed. I will not like anyone to think that I escaped punishment because of the time taken in trial.

i) From the orders of Special Judge that I have read so far in these cases where I have been made accused it appears to me that by that logic I will be made accused in almost every case where FIR has been registered. Perhaps I will have largest number of cases of corruption and conspiracy against me. This, in itself is good enough reason to withdraw the personal bail bond.

j) And finally the most important reason, I am a total believer in God and destiny. While we do our duty the result is always in hands of God. We should accept everything as God’s blessings. My inner voice tells, me that perhaps it is the wish of God that I should stay in Jail. Perhaps I will at peace with myself by following this course of action.

Why no advocate

a) First of all I would like to express my gratitude to my advocate Shri B.S. Mathur who has represented me in all the cases of Coal Block allocation where I am an accused. In fact he has been extremely considerate in respect of his fee.

b) The way I have been made an accused in cases so far I am quite sure that there will be many more cases in which I will be made an accused. There is no way in which I can pay the fee of an advocate in all these cases. Government gives pension which is good enough to live a retired life but there is no way that fee of advocates can be paid in such large number of cases from pension. Moreover, I do not want to have an advocate whose fee I cannot pay. I do not want to take such an obligation at this stage of my life.

c) I do not want to face these cases on the basis of legal technicalities. I shall try to bring out the facts as known to me during the trial and then leave the rest to the Judge who I believe knows the law and does not need an advocate to enlighten him. Most of these cases are document based where there is not much dispute about the documents and so an advocate may not have much to contribute.

d) Even otherwise I believe that objective of every criminal case is to find the truth. Effort of every one — the investigator, the prosecutor, the Judge and even the accused should be to cooperate in this venture. Such being the situation, I do not think that there is any need for an advocate to represent me.

e) These days my relatives and friends are trying to help me financially and have done so. My well-wishers and friends are suggesting ways to raise resources to contest these cases. While I am grateful to them, these things are not acceptable to me and this causes more pain to me.

f) During the coal block allocations there were officers who worked with me or interacted with me. I know that many of these officers have unimpeachable integrity. Many of them are facing trials now. I would urge the Government to think of these officers who are still in service and are facing trials. They have no money to hire the services of advocates. I think it is time the Government recognizes its honest officers and protects them rather than prosecuting them.


HC Gupta (IAS 1971 RR, UP cadre) and the Coal Block scam – preliminary analysis #2

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It is no surprise that the root cause of corruption in the Indian press is the same as that for all other problems: socialist governance system

A couple of days ago I wrote about the demand from the Hyderabad press for money else they would not publish anything about Swarna Bharat Party’s press conference.

Three other important pieces of information came from various sources. I’m compiling them here:

1) Chakravarthy Nalamotu (on FB). He wrote:

Most of the press guys that that attend these press meets either don’t get paid or paid paltry sums. The management encourages them to extort money, this includes blackmailing. When I was politically active we regularly paid them and reached a point where they were on a monthly payroll. All major Indian political parties pay the media guys for coverage. Paying doesn’t guarantee coverage, but not paying certainly ensures no coverage.

2) Rameshbabu T, Editor of BHAGYANAGAR POST (Hyderabad), wrote:

I’ve read your feelings and I do agree completely with you. I greatly honor your words with utmost respect. We can’t find a true journalist as all the public fields are spoiled like the same. I request you to understand the stringers’ or contributors’ conditions in a broader manner. They neither have monthly payments, nor daily allowances. Owners of the many media houses do not pay a single paisa for their contribution. Then how could they survive, without any inputs? So, they are asking a COVER is routine process in Hyderabad.

All the politicians and press needy are ignoring this, though they also feel awkward about the situation you have faced like. Because, no person is there to solve this or no person is there to look into this.

Some kind of solution be needed to check this. I hope that may starts from you.

3) A businessman in the know wrote:

There is a very large company in India that offers journalists a “Welcome Pack” to attend their AGM. (And they are not the only ones). The pack reportedly consists of Rs 10,000 cash plus Rs 10,000 in various “gift certificates”. Their Annual Report is hardly ever scrutinized by the press. Why do you think that company’s, and it’s owners, scams are glossed over? Mera Bharat Mahan.

So what is going on is this:

Given the vast over-supply of educated unemployed, it appears that a lot of people enter journalism without pay. These people are expected by the media houses to not only produce high quality and interesting text, but to get paid from the organiser of the event, itself! This is one more case of socialist policies having led to a situation where there are virtually no jobs and those on some kind of a “job” are expected to make most of their money from event organisers. Where event organisers are corrupt socialist parties, they have plenty of black money to distribute in cash.

Like ALL problems in India, this one can be directly attributed to the corrupt and criminal socialist system. Unfortunately, these journalists are too minor in the pecking order to fight the bigger picture issue.

I’m loathe for the government to create laws in this regard. The solution will need to come through system reform, so that when there there are a vast number of good jobs in the private sector, and corrupt politicians and parties can no longer exist, both the demand and supply side of this problem will be eliminated.

Until then, it is our job as Swarna Bharat Party to stick to the correct path and raise awareness of this issue – and show journalists how their entire profession has become contaminated due to Indian socialism.


It may be noted that at least two journalists in Hyderabad DID publish without money:

a) Andhra Jyothi – published on 10 August:


b) In Sakshi, published on 10 August 2016
















Instead, it was the Bangalore press – that had only very indirectly hinted at money – that did not publish a SINGLE write up.


My FB comment here: https://www.facebook.com/sabhlok/posts/10154393098588767


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