Spare a thought for harried businessmen

Are businessmen responsible for all the ills of the country? At least that’s what seems to be the opinion of the present regime, particularly Finance Minister Arun Jaitley.

Rising non-performing assets (NPAs), negative  Index of Industrial Production (IIP), lowest banks’ credit growth of 60 years, unprecedented unemployment and business sentiment going low by the day.

Ironically, the Government of India is busy making new laws (Insolvency and Bankruptcy Code, 2016) and amending the existing ones (Securitisation and Reconstruction of Financial Ass­ets and Enforcement of Security Interest Act, Debt Recovery Tribunal Act), making them tough­er and stricter giving more teeth to the banks to recover their dues faster from businessmen.

No thought seems to have been spared as to where the economy of the country is heading. Are the Sensex and NSE figures the only indicators of the country’s economic health? Do they reflect ground reality? Does the MSME sector have any bearing on stock market? It is very pertinent to know that small industries sector accounts for 45% production of country’s industrial sector and more importantly, employs 97% of country’s industrial workforce.

It will not be an exaggeration to claim that the unorganised industrial sector coupled with small business, forms the actual backbone of this country’s economy. In this country of 1,300 million population, providing jobs is as necessary as value addition or wealth creation is. That’s exactly where the unorganised sector scores over large industries, MNCs and the organised sector.

In this country, a farmer’s suicide (which is very unfortunate) is a newspaper headline. If an elephant or a rhinoceros is killed in Assam, even that is enquired into. Does anybody even know that several of MSME promoters have also committed suicide in last 4-5 years? Has anybody tried to analyse why the businessmen are losing money continuously?

After all, why and what is the cause of such burgeoning and back breaking NPAs? That is something nobody is bothered about. The only cause of concern seems to be, how to recover banks’ dues. Though the recovery is important, life definitely is more important than money. People in power must realise that there was a systematic system failure at the time of UPA-2 regime and sadly no action has been taken by the present NDA government to initiate policy corrections to help businessmen.

Defaulter entities
As you try to recover from defaulter entities, the more you will try the more number of fresh defaulters will be there. Unless a root cause analysis is done and the causes are rectified, the economy will never get rid of this all-encompassing problem of NPAs. How much provisionthe banks can provide for? How much recapitalisation of banks can be done by the government?

The first and foremost requi­rement of the time is to help the businesses, which are still running, providing jobs and generating revenue. Every businessman can not be compared to wanted liquor baron Vijay Mall­ya. How can a person, having his own residential house mortgaged to the bank, be an intentional defaulter? It is also to be kept in mind that even if a bank is able to somehow take possession of the properties of a defaulter, where are the buyers?

Actual buyers, property market, engineering colleges, marriage halls and all conceivable potential investors are facing bad times. So the banks will still remain stuck with bad loans. The only way to make good the banks’ money is to help the deserving cases, which most of them are. Of course, ‘wilful defaulters’ must be punished with toughest of measures, but they are only handful in number.

Somehow the finance minister thinks that every businessman is a crook and they need toughest possible laws and measures to be tackled properly. Jaitley, as law minister got the SARFAESI Act (auctioning properties of defaulters) amended. This is a draconian law. The Insolvency and Bankruptcy code, 2016 is by far the toughest recovery law having unthinkably harsh provisions. Besides, the SARFAESI Act and DRT Act have been made more tough and anti-business.

The prime minister should think that ‘Make in India’ is not just there only to attract fresh investments – foreign or domestic. It must also mean support to the old, existing businesses. You cannot build castles on the ruins of killed opportunities.
Dear prime minister sir, the business class had hoped for ‘acche din’, when you were voted to power in 2014. Kindly spare a meaningful thought and extend a helping hand to them also.

(The writer is an engineer and a small scale entrepreneur)

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