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LIC Forced to Pay for Modi’s Pampering Moves: CPI

Hyderabad: The National Secretariat of the Communist Party of India strongly objected to the calculated moves by the RSS-controlled BJP government led by Narendra Modi to kill the public sector units and public sector banks one by one so that our entire economy can be pushed into the garb of neo-liberalism. The latest victim is the public sector insurance major Life Insurance Corporation of India, which was till the other the only national insurance company in the country.

In a press note, the CPI said that despite the Modi government’s tall claims of investment norms, bad loans in the life insurance sector after the PSBs are rising and already the NPAs of the sector have gone up by 26 per cent from close to Rs 18,000 crore (provisional) in the fiscal ended March 2017 to Rs 22,700 crore (provisional) for the year ended March 2018. It is highly objectionable that a major chunk of the NPAs are accounted by LIC. The only consoling aspect is as of today as the total asset base of the industry is around Rs 34 lakh crore (provisional) and the assets under management (AUM) is around Rs 32 lakh crore (provisional), the NPAs may not immediately affect the functioning of LIC unless the reckless moves by the government go unabated, as seen in the last month’s IDBI buyout case.

It may be recalled here that the total life insurance NPAs are less than half of IDBI Bank’s gross NPAs of Rs 55,588 crore as of March 2018. Some of the corporate loans extended by the sector, mainly LIC, have become NPAs. Modi government policies are putting the money of common man and future of our country at risk to help corporate interest.

LIC’s bad loans have been steadily rising over the last five years. In 2010-11, its gross NPAs were at just 0.95 per cent. LIC’s total debt of about Rs 3,70,625 crore as of March 2015 is the result Modi’s bankrupt policies. LIC has also extended loans mostly at the insistence of Modi government to the Centre and state governments, banks and financial institutions and companies, which amounted to about Rs 1 lakh crore as of March 2015. Among its top defaulters are Deccan Chronicle, Hamco Mining and Smelting, Punjab Wireless, Tulip Telecom and Padmini Technologies. The Party demands a white paper on the state of affairs in the LIC and urges the Modi government to confiscate the properties all major defaulters without further delay otherwise many of them leave the country like Nirav Modi, the party stated.(NSS)