Former Finance Minister P. Chidambaram on Sunday alleged that the increase in non-performing assets (NPAs), which is essentially a business problem, was given an "undeserving political twist."
Speaking at the launch of his book here, the senior Congress Party leader further alleged that the country was paying the price for the government failing to treat a business problem as required.
"Two major sectors contributing to the rise in NPAs are power and telecom, owing to the uproar in these two sectors. A major twist was given to the policies formulated by the previous government for these two sectors and has thus resulted in the two sectors being left in shambles. Out of the first 12 cases of insolvency referred to the insolvency board, six were of power companies, and unfortunately, the telecom sector is not far behind. I think we have failed to identify this as a business problem and identify a business solution to solve the same, thus resulting in an increase in NPAs," he said.
Chidambaram further claimed that the interference of bodies like the Supreme Court and the Comptroller and Auditor General (CAG) of India in these two sectors added fuel to the fire.
"The CAG report on the telecom sector was a gross exaggeration. In terms of the coal sector, while few cases were examined, nearly 212 coal mines were cancelled ultimately. I think we failed to treat a business problem as a business problem. It was very convenient for a few political parties to give it a political twist, and now, the whole country is paying the price for it," he said.
The Indian telecom sector has been under stress in the recent past, to which the industry recommended that a telecom policy be drafted so that a balance can be struck between providing welfare to the customer and securing the financial health of the industry.
On Wednesday, the Union Cabinet chaired by Prime Minister Narendra Modi approved two key measures for the telecom sector to facilitate investments, consolidation and enhance ease of doing business.
The measures included restructuring deferred payment liabilities of spectrum auction of telecom service providers and revising the limit of the cap for spectrum holding for telecom service providers.