Dear Friends, I solicit your valuable feedback on MyEssay in RBI'2017 Mains Exam. Q) What are your

Dear Friends, I solicit your valuable feedback on MyEssay in RBI'2017 Mains Exam. Q) What are your suggestions on reducing NPA in Banks? Recently, non-performing asset (NPA), assets which are not generating any income to banks (either interest on loan or principal installment or both) for more than 90 days, has been rising constantly in Indian Banks. According to Economic Survey 2016-17, NPA in India has risen to 9.6% of total advances of the banks and about 80% of this is concentrated in public sector banks which makes this problem even more menacing. This has given rise to another situation of twin balance sheet problem in which banks can’t provide new credit to companies due to non-availability of funds while companies can’t take new initiatives to grow their business and earn money and repay the loans due to unavailability to credits from Banks. The government and RBI have taken a number of measures to curb this menace but without much success. In my opinion, most of the measures taken, such as Strategic Debt Restructuring (SDR), Scheme for Sustainable Structuring of Stressed Assets (S4A), 5/25 scheme, etc., are good and could bear fruit if applied timely and strictly. Also, the Banking Ordinance 2017 adds more teeth to RBI’s actions (such as prompt corrective action – PCA) in curbing NPA. I believe the RBI’s initiative of Asset Quality Review to clean the bank’s balance sheet will be much more effective than above mentioned measures in the long run as it prevents generation of NPA in its origin. Public Sector Asset Rehabilitation Agency (PARA), as suggested in Economic Survey, which will take over bank’s bad debt entirely and generate revenue by different operations such as converting into equity, auctioning of assets etc., would free the banks from NPA burden and enable them to restart stagnated credit process which in turn would provide much needed impetus to the economy. Having said all these, it really depends how effectively government and RBI are able to enforce these measures to resolve the NPA menace and revive the banking industry in India. (95% similar to the original essay written in Exam)

 

Few points1. Long sentences have high chances of grammatical error 2. Your own point missing 3. Asset quality review should have come earlier to make the flow better 4. PCA is more related to solving financial constraint and protecting deposit than solving NPA crisis. 5. PARA was discussed and not suggested in ES. However , RBI won't be checking essay in this detail. Only thing is short sentences means better Grammar.

 

Thank you Sudhanshu for your valuable feedback. I've developed, over the time, habit to write long sentences (news paper syndrome) and not able to shed this. However, if you could please point out any grammatical mistakes in the essay, It'd be very helpful.

 

Prima facie it does not have many issues. Probably it's Grammatically correct with few minor issue. However, I am just rephrasing your one sentence. You shall be able to gauge the difference. You wrote "Public Sector Asset Rehabilitation Agency (PARA), as suggested in Economic Survey, which will take over bank’s bad debt entirely and generate revenue by different operations such as converting into equity, auctioning of assets etc., would free the banks from NPA burden and enable them to restart stagnated credit process which in turn would provide much needed impetus to the economy. "I will write the same as "Public Sector Asset Rehabilitation Agency (PARA), as suggested in Economic Survey, will take over bank’s bad debt, freeing the banks from NPA burden. It will enable them to restart stagnated credit flow thus providing much-needed impetus to the economy PARA will generate revenue by different operations such as converting into equity, auctioning of assets etc.. I will suggest a simple thing. Try Translating what you wrote to your mother tongue and see if it is making any sense. For example Who will be generating revenue? PARA or Bank? what is credit process? Why use so many connectors which are adding to the confusion. It is also eating into permissible word limit. I may have conveyed the same meaning. You have used 60 words. I have used 55. You wasted 5 words in a word limit of 300 words. 4 such sentences and u can add one more point. Apologies if I am sounding harsh.

 

I concur with your analysis. I too feel that I'm unnecessarily complicating things by writing long sentences, including two or three points in a single sentence. I'm going to work on this to improve this aspect of my writing. You're not at all harsh but to the point and rational. I really appreciate your feedback. Thank you so much.

 

If you have mentioned the Viral acharya's 5 point strategy, you would have fetch the good marks. The question was on suggestions regarding solving the NPA's. Anyway overall the essay is totally acceptable. You can fetch decent marks.

 

I had mentioned about his private arc and national arc part.

 

more on a factual note than analytical.....less safety measures..

 

Couldn't think of any so gave my opinion on existing measures. Would you be kind to provide some suggestions other than existing ones?

 

first and foremost is strengthening of independence of BBB.

 

alternatives for capital funding of PARA disregarding the funny options such as using RBI reserves or windfall gains due to demonetization.

 

strengthening the independence of BBB is an administrative measure which will provide BBB much more leg room to act independently and effectively to implement other mentioned NPA reducing measures. However, BBB is not specifically for NPA but it covers...See more

 

In my opinion larger part of NPA in PSBs is primarily due to administrative weaknesses in their higher management.