Soon after Minister of State for Finance Shiv Pratap Shukla told the Parliament that the government had written off Rs. 2.41 lakh crore worth of loans between 2014 and 2017, West Bengal Chief Minister and Trinamool Congress Chief Mamata Banerjee pounced on the issue and used it to trigger outrage.
However, there was no reason to be alarmed. According to data released by the Reserve Bank of India, loan write-offs as a percentage of gross non-performing assets (NPAs) declined to 13 per cent as on March 2017 from a high of 25 per cent in March 2011. Banerjee, it seems, forgot to note the decline.
Under the Congress-led United Progressive Alliance (UPA) government, loans written off as a percentage of gross NPAs rose from 21 per cent in March 2006 to 25 per cent in March 2011. Interestingly, Trinamool Congress was part of the UPA in 2011 and Banerjee served as the Minister for Railways from 2009 to 2011.
Under the National Democratic Alliance government, write-offs declined to 18 per cent of gross NPAs in March 2015.
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