Sunday, November 23, 2014
Press Statement issued by BEFI
Press Statement issued on 22nd November 2014 by
Shri Pradip Biswas,
General Secretary, Bank Employees Federation of India, at Kolkata,
On $1 Billion advance by SBI to Adani Group.
“We have come across reports of State Bank of India (SBI) agreeing to dole out
an astronomical Rs.6200/- Crore to the Adani Group for its $16.5 Billion Coal and Mine Development project in Australia.
The surreptitious character of the deal raises many eye-brows.
Adani Group is already saddled with a total outstanding liability (debts) of Rs.72, 632/- crore, mostly to the Banking Sector,as at the end of September 2014;
addition of yet another dose of Rs.6, 200/- crore would certainly be more than
the last straw on the camel’s back.
Moreover, when international financial and banking giants like Citigroup, Morgan Stanley, J.P.Morgan, HSBC, Barclays, Chase-Manhattan, Goldman Sache,
Deutsche Bank, Royal Bank of Scotland, Credit Agricole have all refused to fund the project,
SBI rushing to make the largest ever advance by an Indian Bank to a single overseas project is highly questionable; this is more so when Gross NPA
(an euphemism for “Bad Debts”)
has risen to 5.32% of Gross Advance for all Public Sector Banks taken together as at the end of September this year, up from 4.82% a year ago, and the position of SBI is no better.
The deal between SBI and Adani Group is more conspicuous by the coincidence (?) of PM’s visit to Australia with that of Mr. Gautam Adani, the Group Chairman, going there with a business delegation as also the Prime Minister Modi meeting the Queensland state premier Mr. Campbell Newman “leading to a commitment from the Queensland State Government to take short-term, minority stakes in Adani Group’s rail and port infrastructure projects”.
That the deal is highly questionable is also apparent from the statement by an official of an
eminent research organisation of that country that
“This project is not commercially viable. Eight of the largest global financiers have already said they won’t provide financing to the Galilee projects.
This makes a mockery of the plan by Adani to export two-thirds of the Carmichael Coal back to India.
His own energy minister making it clear India can’t afford to solve energy poverty using hugely expensive imported coal”.
Obviously, if the project does not prove to be “commercially viable”, as apprehended,
the huge outlay of Rs.6,200/- crore by SBI would surely add to its already alarming NPA portfolio.
An ex-FM once observed, “Profits of Public Sector Banks are not for employees only”;
he certainly meant that such profits are for looting by his corporate brethren through NPA rout.
The present Government at the centre appears not only to have inherited that philosophy
but also to be carrying the same forward with more vigour and frenzy.
We are, however, not surprised a bit.
In his campaigning for the 16th Lok Sabha election, Mr. Naredra Modi vociferously assured of “AACHHE DIN” (“Good Days”)
on his assuming the office of the Prime Minister, he appears keen on
guaranteeing that “Good Days” for the Adanis, Adbanis and their clan who worked overtime and spent a fortune for making him what he is today, the Prime Minister of the Country.
But the common people can ill afford this loot of their hard-earned money deposited in
Public Sector Banks.
BEFI, therefore, calls upon all bankmen to rise against such loot of public money through
such unholy nexus between political bosses and their corporate brethren and mobilize public opinion on the issue for putting a stop to such squandering of national resources.”