Loan to Vijay Mallya not waived: Finance Minister

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The government asserted that there had been no waiver of loans extended to the likes of Vijay Mallya’s defunct airline Kingfisher that owes Rs. 7,000 crore to banks, with Finance Minister Arun Jaitley terming the loan as ‘a terrible legacy’ inherited by the NDA from the UPA.

He was responding to CPI(M) leader Sitaram Yechury’s allegation that the government was favouring “crocodiles” while “small fishes” were dying from demonetisation.

“Written off does not mean maafi.... It doesn’t mean that the loan ceases to be a loan. We will still chase the loan, the entry in the book changes from being a performing asset to a non-performing asset,” Finance Minister Arun Jaitley said on Wednesday.

"This (technical write-off) is merely an accounting entry which results in more focus and more sustained follow-up," SBI chairperson Arundhati Bhattacharya told The Hindu. "It is a technical entry which is done in order to put it in a separate account where the follow up is more robust. These accounts are only meant for recovery," she added.

“The liability to pay and the right to recover still remains,” the FM told Parliament, stressing that the loan was sanctioned when the NDA wasn’t in power and was restructured twice during the UPA’s tenure.

“Let’s put the record straight. This loan is sanctioned when this government wasn’t in power, it was restructured also when another government was in power. This is the only loan for which a second restructuring was granted by that government. So we inherited a terrible legacy,” he said.

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