Dr. YV Reddy, Know Thy FUNDAMENTALS of Banking  

June10, 2018 (C) Ravinder Singh progressindia2015@gmail.com

Two lectures of Dr. YV Reddy I attended were basically about GDP growth and Banking Indexes which didn’t impress me – In 1990 India contributed to 2% of World GDP now 3% and in this 28 years population of India increased by 64% from 820m approx. to 1350m today. INDIA’S CONTRIBUTITION TO WORLD GDP IS NOT GROWING IN PER CAPITA TERM.

YV Reddy served as Dy Governor and Governor from 1996-2008 – 12 years [including short assignment as Executive Director of IMF]. He is retired IAS of 1964 batch.

MEGA Scams & 90% NPAs occurred in Mumbai next to RBI Head Quarter.

ESSAR STEEL secured bank loans in 1998 but diverted the money for ESSAR-HUTCH telecom project – delayed Steel Plant by 6 years and also claimed Rs.9000 Cr approx. as incentives which was turned down later.

RIL similarly secured LOANS of Rs.50,000 Cr for KG Basin but diverted money to Reliance Telecom & Refinery delayed Contract for KG Basin Production by 4 years.

TOI Rs.750 Cr Scam ‘Company had evinced interest in starting various processing plants for sugar, soft drinks, fruit juice, instant food mix, energy food and spice powder.’

In above a Trader operating from Mumbai secured Bank Loans of Rs.750 Cr for FOOD PROCESSING Projects in Kutchh District from 2012. Not a brick was laid at 61 land parcels. Everything was Fine for Banks and Government – an RTI activist exposed it not the RBI & Banks Vigilance Departments.

What is Common in these three plus Nirav Modi & Chowksi cases is that Mumbai based Bank HQs Released ‘FULL LOAN AMOUNTS WITHOUT ANY PHYSICAL VERIFICATION FOR 4-7 YEARS.’

Basic FUNDAMENTAL – Banks Didn’t LINK LOANS to JOB CREATION, TAX COLLECTION, INCOME TAX, DUTIES ON PLANT & MACHINERY etc.

BANKS REFINANCED & RESCHEDULED LOANS WITHOUT PHYISICAL VERIFICATION.

I asked Deputy Governor RBI three thing in 2011 –

First that to get a Loan of Rs.10 Cr Banks in India need Mortgage of Homes worth 20 Cr whereas in USA a person with Rs.1 Cr cash would get Rs.10 Cr Loan for a project.

Second Bank Managers are not Qualified to Understand the finances required by Companies and Industries – ‘A Qualified Engineer could accurately assess the Bank Loans required by a Client in hours’.

Third A Bank Branch may advance Loans to Companies in a Radius of 200 km to 1500 km – there is no monitoring of the Companies Operations at all.

Ravinder Singh, Inventor & Consultant, INNOVATIVE TECHNOLOGIES AND PROJECTS

Y-77, Hauz Khas, ND -110016, India. Ph: 091- 8826415770, 9871056471, 9650421857

Ravinder Singh* is a WIPO awarded inventor specializing in Power, Transportation,

Smart Cities, Water, Energy Saving, Agriculture, Manufacturing, Technologies and Projects

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