In 13-tweet retort, Nirmala Sitharaman debunks Congress' claims over corporate loan write-off

Union Minister of Finance Nirmala Sitharaman on late Tuesday night targetted Congress leaders Rahul Gandhi and Randeep Singh Surjewala and said that the Congress party's claims regarding the corporate loan write-off have attempted to 'mislead people in a brazen manner'.

Notably, the matter concerns a recent reply by the Reserve Bank of India (RBI) to an RTI query, which states that outstanding loans amounting to Rs 68,607 crore of top 50 wilful bank loan defaulters in the country have been technically written off till September 30, 2019. These include firms of fugitives like Mehul Choksi and Vijay Mallya.

Rahul Gandhi had lambasted the Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) government at the Centre over this corporate loan write-off and said that the government had hidden the list of names of 50 biggest bank scammers from the Parliament because it included "friends" of the ruling party. 

Taking to her official handle on Twitter, Sitharaman today alleged that the Congress has typically resorted to sensationalizing facts "by taking them out of context".

In a 13-tweet retort, the Finance Minister wrote, "Provisions are made for NPAs as per the four-year provisioning cycle laid down by the RBI. Upon full provisioning being done, banks write-off the fully provided NPA but continue to pursue recovery against the borrower. No loan is waived off."

She pointed out that from 2015, PSBs were asked by the Narendra Modi-led central government to check all NPAs more than 50-crore for wilful default. Sitharaman provided details regarding the ongoing cases concerning the various fugitives:

In the Nirav Modi case, immovable and movable properties worth more than Rs 2387 -crore have been attached or seized. More specifically, the amount attached is Rs 1,898 crore and the amount seized is Rs 489.75 crore. This includes foreign attachments of Rs 961.47 crore. Auction of luxury items worth Rs 53.45 crore has also been conducted. Nirav Modi is in prison in the United Kingdom.

In the Mehul Choksi case, attachments are worth Rs 1,936.95 crore, which includes foreign attachment of Rs 67.9 crore and a seizure of Rs 597.75 crore. A red notice has been issued in this regard, while an extradition request has been sent to Antigua. The hearing for declaration of Mehul Choksi as a fugitive offender is currently in progress.

In the Vijay Mallya case, the total value at the time of attachment was Rs 8,040 crore and the amount seized was worth Rs 1,693 crore. The value of shares at the time of seizure was Rs 1,693 crore. Mallya has also been declared a fugitive offender. On the extradition request by the Government of India, the UK High Court has also ruled for extradition.

Mehul Choksi Case : Attachments of Rs 1936.95 Crore including foreign attachment of Rs 67.9 Crore. Seizure of Rs 597.75 Crore. Red Notice issued. Extradition Request sent to Antigua. Hearing for declaration of Mehul Choksi as Fugitive Offender is in progress.

— Nirmala Sitharaman (@nsitharaman) April 28, 2020

Vijay Mallya Case : Total value at the time of attachment was Rs 8040 Crore and of seizure was Rs 1693 Crore. Value of shares at the time of seizure was Rs 1693 Crore. Declared fugitive offender. On extradition request by GoI,UK High Court, has also ruled for extradition.

— Nirmala Sitharaman (@nsitharaman) April 28, 2020

"9,967 recovery suits, 3,515 FIRs, invoking Fugitive Amendment Act in cases are on now. The total value of attachment and seizures in the cases of Nirav Modi, Mehul Choksi, and Vijay Mallya: Rs 18,332.7 crore," the Union Finance Minister said, adding that it was the Narendra Modi-led government which was pursuing these wilful defaulters.

Sitharaman also took a dig at the Congress and highlighted that between 2009-10 and 2013-14, when the Congress was in power, scheduled commercial banks had written off as much as Rs 1,45,226 crore. To make her point, she quoted the then RBI governor Raghuram Rajan:

"Useful to recall the words of Raghuram Rajan: A large number of bad loans originated in the period 2006-2008...Too many loans were made to well-connected promoters who have a history of defaulting on their loans...Public sector bankers continued financing promoters even while private sector banks were getting out. RBI could have raised more flags about the quality of lending," Sitharaman wrote.

Finally, Finance Minister Nirmala Sitharaman insisted that the Indian National Congress and Rahul Gandhi should introspect why they "fail to play a constructive role in cleaning up the system".

"Neither while in power, nor while in the opposition has the Indian National Congress shown any commitment or inclination to stop corruption and cronyism," Sitharaman concluded.

For context, absconding diamantaire Choksi's company Gitanjali Gems tops the list of these defaulters with a whopping amount of Rs 5,492 crore, according to the list. Mallya's Kingfisher Airlines figures in the list at number 9, with outstanding of Rs 1943 crore which have been technically written off by the banks.