CPI(M) Polit Bureau has issued the following statement on October 25.

THE central government’s decision to recapitalise the public sector banks by infusing a staggering amount of Rs 2.11 lakh crores comes at a time when the banks are burdened by humongous non-performing assets. Instead of pursing the corporates who are not returning the loans that they  have taken from the banks which, according to the international ratings agency, Crisil, is estimated at Rs 11.5 lakh crores, inclusive of interest, the government has virtually pardoned the loan defaulters.

During the course of these three years, this BJP government has written off corporate loans to the tune of Rs 2 lakh crores.  This mega concession for the corporates is now being met through public funding of this recapitalisation.  This is tantamount to the Indian people bailing out the banks that are being looted by the corporates.

There cannot be any worse expression of crony capitalism than this.  While loan waivers for the farmers committing suicides due to agrarian distress is refused, the corporates are being encouraged to run away with the loans that they have taken  from the monies deposited in banks by crores of Indians. 

The logic advanced by the finance minister is that this recapitalisation will allow the banks to give further loans to the corporates which will lead to higher investments which, in turn, will lead to an employment and economic growth. This is a flawed logic. Increase in investments per se cannot increase employment and growth rates.  What is produced through these investments has to be sold for this to happen.  In a world of shrinking trade, with Indian exports registering a twenty year rock bottom and the significantly reduced purchasing power in the hands of the Indian people, thanks to demonetisation and GST, has drastically shrinking domestic demand, the finance minister’s logic is simply unrealisable.

No growth or relief to the suffering people can come without economically empowering the people and increasing their purchasing power.  This can come only through a high dose of public investment building our much needed infrastructure and generating huge employment opportunities for our youth.

But this government, following the diktat of international finance capital, pursuing the neo-liberal economic reforms favouring foreign and Indian corporates has embarked on a such a course which will impose even greater burdens on the vast majority of our people. 

The Polit Bureau of the CPI(M)  demands that the government immediately confiscate the properties of the corporates who are defaulting on returning their loans.  The people cannot be asked to pay to protect corporate loot of public money.