Can we bank on our banks?

The bad loans in our banks keep on rising. The trouble is that bad loans are rising not only in absolute numbers but also as a percentage of total loans, which is bad news. Although bank officials and business fellows have colluded in frauds the main culprits are the politicians: their policies and their corruption. We all know about the waiver of all loans to farmers by the Congress in 2008, to win elections in 2009, at cost of Rs 750 billion and now Andhra has announced a waiver scheme at an estimated cost of Rs 540 billion. Andhra is a new state carved out of the old Andhra Pradesh and certainly does not have the money for such a scheme. Not to be outdone the other state, Telengana has also announced a similar scheme which will cost Rs 500 billion and increase bad loans of banks from 2.8% to 8%. The 2 states will expect the center to make up the shortfall in their budgets. The central government should make it absolutely clear that it will not support this criminal waste of public money but it is also guilty of criminal populism by starting a scheme to open bank accounts for everyone who does not have one, which means hundreds of millions of new accounts. Poor people, even those with bank accounts, are rushing to open such accounts because all they are interested in is a loan facility of Rs 5000 which they know they will not have to repay. This is not just disaster for our banks but it turns all the poor into criminals. Those who have repaid their loans feel stupid and rush to take new loans which they do not repay. Where is this money to come from? Only 350 million Indians out of a total of 1,200 million pay income tax and over 80% at the lowest rate. Agricultural income is totally tax free, which means that not only do wealthy farmers pay no income tax but pay no tax on other earnings by hiding them under agricultural income. Is it any wonder that farmers are a major group in parliament, second only to the most favorite occupation of our politicians, which is crime. Since independence, instead of uniting the people, politicians have been slicing and dicing the population into smaller and smaller segments to get elected. We have been divided into majority and minorities, Hindus into SC, ST and OBC, into rural and urban, into rich and poor, into trade groups and many others for the purpose of bribery with public money. So an upper caste, educated Hindu is persecuted into paying income tax but others earning a similar amount will pay nothing and also get handouts. Banks lend with our money which we save with great difficulty after paying high taxes. Politicians have no right to throw it away. It is a crime.