Set right the mess

Sir, - The total money owed by our Central and State Governments runs into several thousands of crores, with most of the borrowings being used for expenditure, which is a dangerous trend. From 1947, the amount of wealth destroyed by us is several thousand crores. Despite this, real estate prices have gone up in our country, which is a paradox.

This is due to the free money (non-performing assets) from banks towards loans. The banks are sitting on crores-worth of real estate, but with the economy in a bad shape it will be disastrous if the banks sell these collateral securities. What we have achieved is a classic case of asset bubble and any asset bubble is dangerous for the economy.

To get out of this mess, the Government should make the laws easier for banks to sell the assets of defaulters, which will bring in money for the banks and reduce the NPAs, increase profit, reduce the fiscal deficit and correct the asset bubble. This will help kickstart the economy.

N. Kalyanaraman,

Chennai

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