Loan defaults till 2009 could top Rs 35,000 cr
Willful bank loan defaults till 2009 are likely to top Rs 35,000 crore, with at least 40 per cent of bad loans coming from companies based in Maharashtra.mumbai Updated: Feb 01, 2010 01:01 IST
Willful bank loan defaults till 2009 are likely to top Rs 35,000 crore, with at least 40 per cent of bad loans coming from companies based in Maharashtra.
The All India Bank Employees Association (AIBEA), which publishes a report on willful defaulters of bank loans, is expected to release its latest report sometime this year.
The last AIBEA report of 2008 said loan defaults for the country were at Rs 20,140 crore. Even then, 44 per cent of the defaults were by companies registered in the state.
A willful (loan) defaulting company is one that shows losses and avoids repayment of loan. AIBEA’s last report said 2,369 companies defaulted in India. Of these, 883 borrowers were from Maharashtra, followed by 287 companies based in Delhi. Compared with the amount stated in the last report, bank loans defaults have risen by 75 per cent since September 2007. Contribution from companies based in the state in the total default amount was Rs 8,877 crore till September 2007, while Rs 3,171 crore was the amount of bad loans from companies based in Delhi.
An AIBEA official said the highest number of defaulters is in Maharashtra as the largest amount of investment comes to Mumbai.
The AIBEA has so far published four reports on willful defaulters of bank loans in 1993, 1997, 2004 and 2008.
The AIBEA has been lobbying to have loan theft included in the Indian Penal Code (IPC) sections but have not succeeded in their attempt so far. “Even electricity and water thefts are criminal offences but loan theft is not,” said Vishwas Utagi, Secretary of the AIBEA.
Utagi added that the AIBEA had written to the Election Commission of India during the last two Lok Sabha elections, requesting the commission to not permit loan defaulters to participate in elections. Utagi said, “It is people’s money, to be used for people’s welfare and not for private corporate loot.”