The signs seem to be promising and if all goes well, it will mean that India is finally putting in measures that will prevent defrauding debtors from fleeing the country and leaving the government pink-faced. The recent spate of economic offenders who have turned fugitives is staggering from any angle: Failed businesses and debts have contributed towards $210 billion (Dh772 billion) in bad loans on banks’ balance sheets, leaving the banking system flagrantly vulnerable and bleeding. The cases of individuals owning billions of rupees to banks having left the country at opportune moments has become the stuff of racy financial thriller scripts and it is time India plugged this gaping loophole with an iron will.
The no-fly listing of 91 people from firms identified as wilful defaulters or those that refuse to repay loans despite having the means to do so is a ripple of hope. The fact that parliament is considering a bill to confiscate the assets of so-called fugitive economic offenders may seem an additional fortification, but the fact is that the existing extradition arrangements have enough teeth. What is softening the bite is the lack of will to implement the law.
Any further rationalising on the issue is to waste time and prolong the obfuscation that this very troubling trend has dragged into public view. With national elections looming next year, it is tempting for the ruling government to up the game of promises, but the dismal record thus far of bringing back the defaulters or even ensuring that the banking system is scam-proof, means India needs to act first and talk later.
Even one or two of the absconding billionaires being brought to book will be enough to give the promises some meaning.
