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Govt to get tough with big borrowers: Jaswant

The government announced on Thursday that it would come down heavily on big defaulting borrowers to check the mounting non-performing assets as the Lok Sabha passed the Securitisation Bill.

Replying to the debate on Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Bill, 2002, Finance Minister Jaswant Singh assured the members that government would act impartially against major borrowers as NPAs could impact the nation heavily.

On queries from some members as to why the Bill did not contain harsh measures against defaulters, Singh assured that the finance ministry would constantly review the provisions and said there was good response to notices issued by banks to over 10,000 borrowers following the issuance of the Securitisation Ordinance.

Members from several parties including P R Dasmunsi (Congress) and Raghuvansh Prasad Singh (RJD) wanted the government to bring the defaulters under the criminal prosecution as a deterrent to mounting NPAs saying these were ranging from Rs 70,000 crore (Rs 700 billion) to over Rs 100,000 crore (Rs 1,000 billion).

The finance minister said many defaulters have started approaching the financial institutions, which had issued notices to 123 account holders for one-time settlement.

At the same time, banks should also be sensitive to borrowers' needs without being discriminatory and the government would also bring a Bill for Lenders Liability Law soon, Singh said.

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