FRDI bill will take away guarantee of bank deposits: CPI-M

Kolkata, Dec 13 (IANS) Alleging that the Narendra Modi government's proposed Financial Resolution and Deposit Insurance Bill would create problems for bank depositors in getting their money back, CPI-M politburo member Surjya Kanta Mishra on Wednesday urged people to join protest demonstrations before bank, insurance and financial institutions against the legislation.

"In adherence to the recommendations of G20, the Central government wants to pass the FRDI bill in the winter session of parliament. Though the declared objective is to insure deposits to solve the economic problems of sick banks and financial institutions, the real objective is something else.

"Through this legislation, the sick banks, insurance and financial institutions would try to regain their financial health by utilising the money parked by the depositors with them," Mishra said.

Pointing out that the banks were incurring heavy losses due to the big corporate houses not repaying the huge loans they had taken from them, he said the unrepaid loans have doubled to over Rs 10 lakh crore during the three years of the Modi regime.

"The government now wants to come up with a law to use the deposito rs' money to improve the banks' financial health, but it refuses to take any action against the guilty corporates," he said.

"The bill that has been prepared, may cancel out the losses of the bank, insurance and financial institutions, but the three steps that the law prescribes in case banks turn bankrupt, will reduce the power and authority of the Reserve Bank of India and the deposits of depositors will not have the guarantee of security any more," he said.

The steps are selling off the bankrupt banks and financial institutions to private financial companies including foreign corporate, merging them with other such institutions and cancelling out the losses by using the money of the crores of depositors without their permission.

According to Mishra, it was an "unprecedented attack" on th e crores of common people, particularly, the poor, lower income, middle income groups, pensioners, and small manufacturers and businessmen who are already troubled after the GST rollout.

"Such attacks had never been seen before. The depositors cutting across party lines should raise a chorus of protests against the move. People from all strata need to be rallied before banks, insurance and financial institutions to launch continuous protest programmes," he said.