A very political banking crisis

Even when faced with a banking crisis, the government has not even attempted to address the root cause of decades of bad loans

You’d think that economists would be happy that, for once, everyone is talking about factor markets. Well, more precisely, they’re talking about the conditions attached to capital availability in India — who gets bank loans and why. After all, economists have complained for decades that factor markets in India — land, labour and capital — are so antiquated and restrictive that they have held back economic growth and poverty reduction. Yet the controversy about non-performing assets and bad loans — a controversy that looks close to being upgraded to a scandal — has been overtaken by political rhetoric and scapegoating,