The Mallya Signal - Indian Express
His arrest is a welcome first step. Now follow up this case, while also bringing in systemic reforms to address bad loan crisisThe arrest of the fugitive and high-profile Indian businessman, Vijay Mallya, in London on Tuesday by Scotland Yard on an extradition warrant following a request from Indian authorities is an important signal. Failure to repay loans to banks could be costly for promoters and businessmen, it says. Mallya, who has cases against him ranging from defrauding local banks, defaulting on loans adding up to nearly Rs 9,000 crore besides charges of money laundering, evasion of service tax and other financial irregularities, has been granted bail.
The government’s determination to go after economic offenders like Mallya holds out the promise that from now on defaulters will not be spared, regardless of their so-called status in society. Allowing the big and mighty to go scot-free obviously makes it difficult to argue against populist loan waiver schemes. At the same time, however, pushing for the prosecution of high-profile individuals amid media glare only makes for optics and has only symbolic value beyond a point.
For, the fact is, the arrest marks only the first step in what could well be a prolonged battle to get the liquor baron to face trial back home. It may be relevant here to recall the country’s track record in securing extraditions in cases such as that of former IPL Chairman, Lalit Modi, music composer Nadeem who is wanted in the murder of music baron, Gulshan Kumar, and the navy war room leak suspect Ravi Shankaran.
Meanwhile, the cost to Indian banks and the economy in terms of the failure to resolve the huge pile of bad loans — brought about, also, by irrational exuberance and infirmities in project evaluation and lending — has indeed been high. Given this backdrop and the slowdown, banks have been treading cautiously since 2014 on disbursing loans. This is reflected in the fact that in the fiscal year that just ended, FY17, Indian lenders grew their loan book by just 5.1 per cent — a 60-year low despite the slide in interest rates by over 250 basis points during this period.
What we need, ultimately, are strong bankruptcy laws and speedier resolution processes. There has to be an automatic market-based mechanism for lenders to initiate recovery proceedings against corporate defaulters through seizure and auctioning of assets.This will also do away with the possibility of governments “picking and choosing” who they go after and who they spare. Insulating Indian banks from government influence on lending decisions will, however, remain a challenge as long as the government continues to be a dominant shareholder. Addressing these issues will be the key to restoring loan growth — critical once the economy rebounds.
IMPORTANT WORDS & THEIR MEANING FORM ARTICLE
1) Fugitive (भगोड़ा) - Few-g-tive
- Meaning - a person who has escaped from captivity or is in hiding - Noun
- quick to disappear, fleeting - Adjective
- Synonyms - escapee, deserter
- Antonyms - enduring, lasting
- Example - The fugitive hoped he could cross the border before the police caught up with him.
2) Extradition (प्रत्यर्पण) - Extra-di-tion
- Meaning - the action of extraditing a person accused or convicted of a crime - Noun
- Synonyms - deportation, expulsion
- Example - The group will then make its extradition request, he said.
3) Defrauding (धोखा देकर ले लेना) - De-fraud-ing
- Meaning - illegally obtain money from (someone) by deception - Verb
- Synonyms - swindle, cheat
- Antonyms - assist, help
- Example - Stop defrauding your players, coaches and fans by using replacement referees.
4) Laundering (काले धन को वैध) - Laund-ering
- Meaning - conceal the origins of (money obtained illegally), typically by transfers involving foreign banks or legitimate businesses - Verb
- Synonyms - concealment, concealing
- Example - They have no legislation at all to deal with money laundering.
5) Evasion (टालना) - Eva-sion
- Meaning - the action of evading something - Noun
- Synonyms - dodging, eluding
- Antonyms - honesty, reality
- Example - People tend to evade direct eye contact when they are lying.
6) Determination (संकल्प) - Deter-min-ation
- Meaning - the process of establishing something exactly by calculation or research - Noun
- Synonyms - assurance, bravery
- Antonyms - fear, idleness
- Example - Jim’s determination allowed him to finish the marathon despite his injured ankle.
7) Waiver (त्याग) - Wave-er
- Meaning - an act or instance of waiving a right or claim - Noun
- Synonyms - surrender, rejection
- Antonyms - approval, sanction
- Example - Some insurance companies will waive rate increases for drivers who have excellent driving records.
8) Glare (प्रभावोत्पादकता) - Glay+r
- Meaning - stare in an angry or fierce way - Verb
- a fierce or angry stare - Noun
- Synonyms - flame, glow
- Antonyms - smile, grin
- Example - The sudden glare hurt his eyes.
9) Infirmities (निर्बलताओं) - In-firm-eities
- Meaning - physical or mental weakness - Noun
- Synonyms - ailment, frailty
- Antonyms - health, ability
- Example - Despite his physical infirmity, the old man still maintained a sharp mind.
Word of the Day
10) Diseminate (प्रसारित करना) - Dis-semi-nate- Meaning - spread (something, especially information) widely - Verb
- Synonyms - spread, diffuse
- Example (English) - These days news is disseminated through not just traditional media such as newspaper and television but also through new channels such as Facebook and Twitter.
- Example (Hindi) - आजकल खबरों का प्रचार केवल अख़बार और रेडियो जैसे परंपरागत माध्यमों से ही नहीं बल्कि फेसबुक और ट्विटर जैसे नए साधनों से भी होता है।
Now considering the article above as a Reading Comprehension question, try to answer the following -
- What exactly is the Vijay Mallya case? Can someone explain it briefly?
- How did a business tycoon who seemed to be successful at one point end up being a “wilful defaulter” on the run?
Given below are some words to check your vocabulary you can make sentences with those words in the comment section which will be reviewed by us.
- Prosecution
- Prolonged
- Rebounds
- Treading
