It is just over a week since an RBI-appointed Expert Group called for an early end to the present smoke and mirrors system of estimating (obfuscating?) non-performing assets (NPA) numbers, euphemistically termed 'regulatory forbearance'. Yet, far from heeding the Group's suggestion, the government is reportedly contemplating exactly the opposite. Faced with the prospect of drought in large parts of the country, it wants to continue the existing practice of regulatory forbearance. This would enable banks to restructure their short-term crop loans, particularly those made to small and marginal farmers, without classifying them 'non-performing.' Under the existing guidelines, banks are required...
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