The peo­ple will de­cide Vi­a­bil­ity is a cri­te­rion

Business Standard - - ISSUES AND INSIGHTS -

Al­most ev­ery­one is tak­ing great in­ter­est in the Gu­jarat elec­tion and watch­ing it keenly. It is be­ing fought with vigour be­cause much is at stake. The prin­ci­pal con­tenders for power, the Bharatiya Janata Party (BJP) and the Con­gress, are beaver­ing away at their re­spec­tive cam­paigns. Win­ning this elec­tion is cru­cial to their po­si­tion­ing and fu­ture in na­tional pol­i­tics. Prime Min­is­ter Naren­dra Modi’s pop­u­lar­ity, his sweep­ing mea­sures such as de­mon­eti­sa­tion and the goods and ser­vices tax and the Op­po­si­tion’s ac­cept­abil­ity would be tested in this elec­tion.

Gu­jarat is re­garded as the BJP’s bas­tion and the “lab­o­ra­tory for Hin­dutva pol­i­tics”. Given the BJP’s dom­i­nance, un­til a few weeks ago the elec­tion ap­peared to be a one-sided match. Now, pun­dits are speak­ing of a pos­si­ble photo fin­ish. If the cur­rent mood on the ground is any in­di­ca­tion, the Con­gress is poised to out­pace the BJP.

The “Gu­jarat model of de­vel­op­ment” has lost its ap­peal across the so­cial spec­trum and has been ridiculed on so­cial me­dia. The per­cep­tion that Modi is a “jadugar” (ma­gi­cian), who uses trick pol­i­tics, is shared by an in­creas­ing num­ber of peo­ple. Time is run­ning out for the BJP to win back vot­ers, who have been alien­ated by its bad de­ci­sions. The hash­tag “Vikas gando thayo chhe” (de­vel­op­ment has gone crazy) has gone vi­ral and res­onated with vot­ers.

Tap­ping into the anti-BJP sen­ti­ment, Con­gress is try­ing to stage a come­back. Its cam­paign packs pow­er­ful punches the BJP finds hard to counter. The co­a­les­cence of so­cial move­ments led by Jignesh Mevani, Alpesh Thakor and Hardik Pa­tel against the BJP has the po­ten­tial to deny it the chance to come to power for the fifth con­sec­u­tive term.

Field­ing Hindu seers for Hindu con­sol­i­da­tion or Ram Vi­las Paswan to counter the pop­u­lar­ity of Dalit leader Mevani, mock­ing Con­gress Vice-Pres­i­dent Rahul Gandhi ( pic­tured) for his tem­ple vis­its and re­leas­ing a “mor­phed sex video” fea­tur­ing Pa­tel to de­fame him may not pro­duce the ex­pected re­sults, if not prove coun­ter­pro­duc­tive. A party’s so-called or­gan­i­sa­tional strength and sup­port of cor­po­ra­te­owned me­dia can­not up­turn peo­ple’s de­ci­sion to send a govern­ment pack­ing.

G David Mil­ton Maruthancode With ref­er­ence to the ed­i­to­rial, “Nar­row, not niche” (Novem­ber 14), de­spite the mea­sures taken to speed up res­o­lu­tion of bad as­sets, the bank­ing sec­tor is still un­der pres­sure be­cause of the large vol­ume of such as­sets, par­tic­u­larly in pub­lic sec­tor banks (PSB).

Among PSBs, the weak ones are be­com­ing un­vi­able on ac­count of ris­ing credit cost and neg­a­tive or di­min­ish­ing re­turns. At this junc­ture, in­fu­sion of need-based cap­i­tal is nec­es­sary. Re­cap­i­tal­i­sa­tion should be in ac­cor­dance with bank-spe­cific re­quire­ments.

The strengths and weak­nesses of each bank is cru­cial in de­cid­ing its vi­a­bil­ity, there­fore, an over­haul is es­sen­tial to im­pose cor­rec­tive mea­sures. Hu­man cap­i­tal with suf­fi­cient skills to op­ti­mally use mod­ern tech­nol­ogy is of im­mense value in mit­i­gat­ing risks in­volved in credit de­liv­ery and in fram­ing tech-savvy prod­ucts and ser­vices. Re­spon­sive and re­spon­si­ble ser­vice to cus­tomers is es­sen­tial for sur­vival in a com­pet­i­tive mar­ket.

Small banks should look for small bank­ing ac­tiv­i­ties to en­sure their sur­vival and to aug­ment risk-free earn­ings. It is bet­ter to dif­fuse fo­cus from big ticket loans that have long ges­ta­tion pe­ri­ods. The govern­ment and the bank­ing reg­u­la­tor should look to ex­e­cute merger and con­sol­i­da­tion re­form in the bank­ing sec­tor only af­ter en­sur­ing that small and medium PSBs are vi­able enough to be merged with strong banks.

V S K Pil­lai Changanacherry

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