BY : Ravinder Singh
It is disappointing that hard work of 99 per cent Indians reflected in tripling of bank credit in five years to industries at Rs 20,00,000 crore or 50 per cent of all bank credits is largely going waste and diverted to foreign countries. It is not reflecting in industrial growth, employment generation, skill development, improved services, creation of intellectual property and growth of high value exports. India is therefore becoming an Anemic Economy increasingly dependent on foreign imports, foreign technologies and foreign investments. The $400 billion credit to industry, worth $2000 billion in PPP terms, is biggest setback to Indian economy with long term consequences. When the GDP growth of India is declining, the Indians are boosting China, ASEAN, Africa, EU and Americas GDP Growth. The credit to power industry, including foreign loans, exceed $100 billion, yet there is no improvement in power sector. Even as electricity bills had more than doubled, there is no improvement in all states except Gujarat. Rs 20,000 crore new credit ought to provide 200 new sugar mills in five years. When super senior citizen goes to cash fixed deposit worth Rs 2,00,000 bearing 8 per cent interest or Rs 16,000 interest income, banks demand 'Tax Exemption Certificate' but there is 'no mechanism to check utilisation of bank credits to industries'.
• The US Security and Exchange Commission Reporting Standards should be applied to Indian industries.
• The Bank Credit Utilisation Certificate and Purchases for each quarter
• IPR profile report every year for companies with over Rs 10 crores turnover
• Human Resource Progress Report – skill development of company, salary and allowances paid per employees in different cadres, salary and PF as per cent of turnover.
• Value Addition Report as per cent of bank credit every quarter. Penal interest rate of 5 per cent on bank credits for below average performers and 5 per cent interest bonus for above average performing companies. This should replace 'incentives and tax concessions granted not linked to performance.
Industry Intelligence Officers in credit branches of banks and ministries The Government of India should appoint qualified engineers as industry intelligence officers in each bank branch to enable 'real time progress of industry in terms of value additions, employment, IPR and skill development, credit needs, etc.' Industry Intelligence Cell in PMO It is important for Prime Minister Office to have Industry Intelligence Cell to access real time progress of different sectors of Indian economy. I have been writing to Prime Minister Office since 1980 on power, IPR, transportation, water, energy saving, agriculture, manufacturing, technologies and projects but there is very little progress. It is possible to ensure uninterrupted power supply next summer and to reduce tariff by 50 per cent that could give substantial kick to Indian industry and economy. In next 10-20 years India can add 200,000 MW of power in Indian River Basins. Similarly, India can create R&D eco-system and factory of the world conducive for R&D progress and investment high-tech industry in few months. India can also enter into patent protection treaty with the USA, EPO and Japan. In the above WIPO document, patent applications applied were 24,382, 28,928, 35,218, 36,812 and 34,287 from 2005-2009, but just 6,168 were granted in 2009 by Indian Patent Office – out of 82600 Patents granted in the world. The Indian companies are investing in foreign countries and over 0.6m Indians study abroad, many more work around the world providing unskilled, low skill and high skill manpower. In just 18 months income of 800m rural India can double by increasing minimum support price for wheat and rice to Rs 2100 per quintal.