Indian Banking System
                                                                         The  Reserve Bank of  India has observed in its 15 Th Financial Stability report of June 2017 that Indian Banking system is suffering from huge' Non Performing Assets' up to 10 Lakhs Crore of Rupees. The Non Performing Assets amounts to Bad Loans given by Banks which are not expected to be recovered. It comes to 9.6% of the loans given by the various government owned banks up to the year 2017.  But the figure may cross 10% in the year 2018. This show that 'NPA' positions of Banks have reached to very alarming Figure.
                                                                         We have to go in the background of Nationalization of 20 Big Private Banks in the the year 1969.  Indira Gandhi then Prime Minister wanted to Nationalize the Private Banks on the pretext that Private Banks are not giving enough finance to Common Men. But the main purpose for Nationalization of Banks was to Gain  Popularity and to create impression among people that she is very progressive leftist politician who wants help common men of India. Even Bank Employees were also behind her in order to get  total job security from Government. Besides that Indira Gandhi also wanted to use Bank funds for her political gain.

                                                                         However her then Finance Minister and Deputy Prime Minister Morarji Desai was for open economy and  he was opposing Bank Nationalization on the Ground that 'It will stop competition among  Banks and its Services will be deteriorating. Besides that he believed that all funds of the Banks are already invested and Government will take simply the burden to runing  the same.  Therefore he introduced Social Control Order for the Banks  wherein Banks were asked the lend  40% of its deposits to  needy Common Men, Farmers, Small Scale Industries i.e. Priority Sector. It was working very well.  However Indira Gandhi took the advantage of Congress Split of 1968 and  took away the portfolio of Finance then from Morarji Desai, Deputy Prime Minister. Morarji Desai resigned and protested against her action. However thereafter she Nationalized  the 14 Private Banks for political reasons. India is still paying very heavily for that decisions.

                                                                       The present 'NPA' position  is created because of  loans given by  Corrupt Bank Officials in collaboration with  Capitalist and politicians.  The 'NPA' of big Industrial Houses are running  in Thousands of Crore Rupees. The Glaring examples are Mallya, Essar etc. The present position will go on deteriorating further if deterrent steps are not taken forthwith. Otherwise Government will be compelled to sell those Banks like 'Air India'. The Government cannot go on maintaining those Banks by giving Tax Money to them at the cost of National Development. It is observed that Private own Banks are running very well with better Customer Services. It is to be seen how government will handle the difficult problem of running the Banks with very high 'Non Performing Assets.

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