Cong: IL& FS crisis ‘ India’s Lehman Brothers moment’
New Delhi, Sept. 26: The Congress on Wednesday accused the Narendra Modi government of bringing India to the “verge of economic collapse” and demanded a Supreme Court- monitored probe into “financial mismanagement” in the Infrastructure Leasing & Financial Services ( IL& FS) group, which has over ` 91,000 crore in debt.
Congress spokesperson Manish Tewari claimed the company was on the verge of bankruptcy and warned if that happened it would have a domino effect and “far reaching consequences” on the country's economy.
“This could be termed as the ‘ Lehman Brothers moment of India’, as the collapse of Lehman Brothers in United States led to the ‘ great economic meltdown’ of 2008... Something similar is happening in India today,” he said, warning that “the Indian economy may plunge into a very deep crises”.
The Congress leader alleged that the Prime Minister’s Office and the Finance Ministry was putting pressure on the Reserve Bank of India ( RBI), State Bank of India ( SBI), Life Insurance Corporation ( LIC) and National Highways Authority of India ( NHAI) to bail out the company, and sought to know the rationale behind it.
He said IL& FS is an unlisted infrastructure development and financing
company, which is 40 per cent owned by the public- sector LIC, SBI and Central Bank of India.
“Why is the NDA/ BJP government going overboard to bail out IL& FS?” he asked.
“The Prime Minister’s Office and the Finance Ministry are putting pressure on the Reserve Bank of India, State Bank of India, LIC and NHAI to bail out this company and the logical question is why this is happening?” he said. The government is trying “to help save foreign investors' money with the help of Indian tax- payers' money”, he alleged.
“We demand that there should be a Supreme Court- monitored multiagency investigation into all issues linked with IL& FS. This is a very serious issue,” he said.
“The NDA- BJP government has brought India to the verge of an economic collapse and the manner in which the affairs of IL& FS fanned out is symptomatic of how this government has handled the Indian economy,” he said.