Banks insist on assets of Rs 200 before lending Rs 100. If a common man requires a loan of Rs 10,000, he has to submit even the title deed of his land as collateral. But if you were borrowing anything over Rs 50 lakh from a nationalised bank, then you have it easier.
The top brass of the nationalised banks are ready to lend big sharks like Vijay Mallya the amount they ask for. If they default on repayment, it will be added to loans that went sour.
The bank executives who send goons after small-time defaulters turn a blind eye towards the rich who default on crores of rupees worth borrowing. They always find loopholes for the big defaulters to save their skin.
The Supreme Court had ordered Mallya to appear before it within two weeks on a petition filed by a consortium of banks seeking to freeze the liquor baron’s passport. The 17-bank consortium, led by the State Bank of India, had also approached the Debt Recovery Tribunal to reclaim crores of rupees from Mallya.
Mallya is also facing a CBI probe on a complaint that he had secured a loan of Rs 900 crore from the IDBI and delayed repayment in collusion with bank executives. The CBI chief had lashed out against the banks which failed to lodge a complaint even after Mallya defaulted on repayment.
I had first-hand knowledge of Mallya’s political clout during my term as the Director General of Civil Aviation from December 2010 to July 2012. Most of the Indian airlines had leased their aircraft from abroad and operated them with Indian pilots. Kingfisher devised a plan to bring the aircraft along with pilots from abroad, even after amassing liabilities in crores of rupees.
I objected to the plan on security grounds because there were concerns about the knowledge of foreign pilots and issues of communication. The aircraft which crashed at the Mangaluru airport, killing 158 passengers, was flown by a foreigner. I was instantly in the bad books of Mallya and others like him.
Meanwhile, I received a complaint that Kingfisher employees were not paid their salaries for months. I was flooded with phone calls day and night, and warnings ranged from suicide to sabotage. I prepared to serve a notice on the airline management but I was transferred within 24 hours.
I was asked to explain how non-payment of salaries constituted a security threat. I stood my ground that an unpaid pilot’s state of mind was detrimental to the safety of the passengers. What would be going through the mind of a pilot who has not paid his home rent or his children’s school fees, when he is asked to fly an aircraft at 2 am?
My bosses were not in a mood to listen. I was shunted out on the orders of the Aviation Minister, who commanded three or four MPs.
Kingfisher is a great example of how not to run an airline company. The company cheated its own employees and banks and has to pay large sums to the airports in the country. Kingfisher was never taken to task because of its political clout. It was splurging public money. It even compromised on passengers’ safety. It has not repaid any of the bank loans.
We have to weed out the wayward influences on our banking system. There is no point in the lament of the bank executives, who had yielded to influences and allowed the plunder of money. It is laudable that the banks and authorities have finally got their acts together.
(The writer is a member of the Central Administrative Tribunal in Gujarat and former chief secretary of Kerala)
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