Financial Daily from THE HINDU group of publications
Friday, May 10, 2002
Money & Banking
Trade & Labour Unions
`Banking industry in peril, wages can wait'
THIRUVANANTHAPURAM, May 9
IN a major reversal of its stated position, the All-India Bank Employees' Association (AIBEA) has decided not to press with any immediate settlement of the wage structure and instead launch massive nationwide programmes to draw public attention to the "severe ills'' afflicting the banking sector and which hold ramifications for the "economic sovereignty of the nation''.
Speaking to Business Line, Mr Tarakeswar Chakraborti, General Secretary of AIBEA, said the association had decided that "the wage talks can wait'' at least for now, concerned as it is by the future of the industry in the context of the proposals in this year's Budget.
He took time off to speak on the sidelines of the AIBEA general council which is now in session here. The association has decided to go on an indefinite strike at the first indication of a Government move to privatise any of the nationalised banks.
The AIBEA has taken strong objection to induction of foreign equity up to the level of 49 per cent in banks, setting up of the asset reconstruction companies (ARCs) and non-recovery of NPAs which has crossed to Rs 80,000 crore. According to Mr Chakraborti, ARCs will only facilitate the whitewashing of bank balance sheets. The NPAs removed from books will be piled on into the ARC's books before being "surreptitiously written off'' in stages without anybody being any wiser.
As for NPA figures, Mr Chakraborti said that he had received indications that non-performing loans had now crossed Rs 80,000 crore and was still growing. "With all the announcement of good intentions in this Budget, we have seen that Rs 15,000 crore-worth of NPAs have been added to the system during this year alone'', he said. He threatened to go public with the list of major wilful defaulters.
Announcement of a hike in foreign equity would have the effect of "handing over our banking jewels on a platter to foreign hands''.
This way, he said, any willing foreign operator and those acting in concert can gobble up banks in the country one by one. This would have deleterious after-effects for the entire economy, unless preventive measures are initiated on a war-footing. "One cannot reconcile to the fact that all this is happening with the active connivance of the Central Government''.
These are issues which demand to be taken up at the national level and that too without delay lest the industry lose its identity and moorings. "The industry comes first. Employees come only next'', he said.
AIBEA has decided to take a morcha of 40,000 to Parliament on November 27 to protest the Government's nonchalance even in the face of grave threat to the very existence of the industry.
The association will collect three crore signatures from the public and present a memorandum to the President.
This will be preceded by morchas in State capitals from August 15 to 30.
The morcha leaders will separately meet with the State Chief Minister and the Governor. July 19 will be nationally observed as a day of pledge when the bank employees will swear by the public sector banking system and also protest non-recovery of NPAs.
Seminars and conventions will be held from October 15 and November 20, he added
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