Two loan defaults lead to two different outcomes, year upon year, a nightmare version of déjà vu. The former exits the country; the latter exits the mortal world. Two loan defaults lead to two different outcomes, year upon year, a nightmare version of déjà vu. The former exits the country; the latter exits the mortal world.

Liquor baron Vijay Mallya and diamond jeweler Nirav Modi could jointly run a crash course for the debt-ridden and beleaguered farmers of Vidarbha, nay the entire country: How to stay cool with unpaid debts.

Mallya could tell the peasantry, for instance, how to convince a public sector banker to keep giving you loans, even when you continue defaulting on staggering advances. While Modi could educate debt-ridden peasants how to exit quietly and within time, alive. The venture could be called M&M.

Peasants like Ravindra Pongale, from the distressed cotton belt of Vidarbha, should have learnt from the M&M tutorial how to deal with loan burdens and its consequent depressions. Alas, Pongale cut short his life when he found he could neither educate his children nor make profits from his arid and dryland four-acre cotton farm.

He became a statistic on December 7, 2017, when he drank a bottle of herbicide ‘Round-Up Ready’ at age 37 – one more farmer to end his life in the country. He left unpaid debts of Rs 1 lakh, which included a crop loan from a bank and hand loans taken from his friends and relatives.

Now M&M could hire Vikram Kothari, a top businessman, to educate beleaguered farmers, particularly those who grow wheat, on how to convince a bank to give you loans to import the commodity, for example Singapore, which doesn’t grow it at all — especially when your main business is producing pens.

The government could nominate M&M under its Skill Development Programme. They need not make their MoU public under a “secrecy clause”.

Nirav Modi plus Vikram Kothari together owe banks money more than the 2017-18 formal farm credit outlay for 11 districts in Vidarbha – where 3.5 million farmers live — of Rs 14,500 crore.

With that kind of money and an equivalent amount borrowed from private sources, farmers grow 4.5 million cotton bales, millions of tons of soybean, paddy, jowar, Tur dal, chillies and other commodities.

Two loan defaults lead to two different outcomes, year upon year, a nightmare version of déjà vu. The former exits the country; the latter exits the mortal world.

The irony is that millions of small and marginal farmers owe bank loans that are a pittance of the advances they have taken. This is because they need to continuously repay or restructure their formal crop loans to keep their current accounts active. Meanwhile, staggering under the weight of willful defaults, banks continue to ask for reinfusion of public money into their tattered systems.

“Something is indeed seriously wrong,” former CBI Director Anil Sinha said on March 3, 2016, speaking at the 7th conference of CBI and Indian Banks’ Association in Mumbai.

Between 2009 and 2015, gross NPAs in public sector banks (PSBs) went up from Rs 44,957 crore to Rs 3 lakh crore, he told the gathering. “We are not even considering huge amounts tied up in accounts under restructuring.” As of now, NPAs hover around Rs 6 lakh crore, going by RBI and government data.

There is a growing trend in case of bank frauds and financial crimes, Sinha said. The CBI investigated 171 such cases involving funds of Rs 20,646 crore in 2015 alone. Add to that, ponzi scheme cases involving funds of over Rs 120,000 crore, he said, adding that the banking and financial system rot ran deeper and that banks delay red-flagging cases and thus allow defaulters to escape.

Truth is, PSBs are grappling to recover a variety of debts – NPAs, wilful defaults and advances reclassified under the just-abolished corporate debt restructuring, amounting to Rs 10 lakh crore. Banks have also written off NPAs worth Rs 3 lakh crore since 2007, at Rs 30,000 crore annually. It’s an endless free lunch for some.

What can India do with Rs 10 lakh crore? Here are some ideas.

We could build 200,000 kms of four lane highways at the government-estimated rate of Rs 5 crore/km, or fund the MGNREGA for 20 years at an annual average outlay of Rs 50,000 crore, or add 2 lakh MW of thermal power at a cost of Rs 5 crore per megawatt of thermal power generation, or resurrect the sagging agrarian and social sectors of the country.

Rupees 10 lakh crore is equivalent to the 2018-19 farm credit outlay for the entire country. But now we don’t know what has happened to this money – money lent by banks to a handful of few individuals.

The worlds of big ticket defaulters and indebted peasants don’t cross each other except when they all land up at the doors of PSBs for loans.

It’s when you see the contrasting worlds — one lines up for loans outside banks for days, sometime months, while the other side makes bankers line up outside their offices – that you wonder what’s going on. This top one per cent world accounts for 73 per cent of the world’s wealth, the latest Oxfam report said in January, 2018.

Against his Rs 1 lakh loan, Ravindra Pongale’s land stands mortgaged with the bank. Last July when he applied for a crop loan, he spent days queueing up and furnishing personal documents — including his Aadhar card — to his rural bank branch in Takli village in the cotton bowl of Yavatmal, Maharashtra.

A day before he committed suicide, Pongale bought a new white cotton shirt and a pant for himself and paid for a list of groceries that he asked his village grocer to deliver two days later to his place, his older and equally financially distraught brother, Mahendra.

Pongale did not reveal his plans, but he looked upset, his widow, Seema, recalled in grief.

The new clothes were meant to be his clothes for his last journey; the groceries were meant for the lunch his family would need to throw for the villagers after his death.

The young farmer’s small world had fallen apart. Pink-worm had devastated his Bt-cotton field; the Maharashtra government’s promise of a farm waiver was taking forever to materialize; he had still not received that in his account. His liquidity had tanked. He had nothing left to pawn so that he could take more loans.

He could not escape his mundane but harsh world. And he had no passport to fly out.

📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines

For all the latest Opinion News, download Indian Express App.

© IE Online Media Services Pvt Ltd