India's Bad Loan Rate Soaring to Near 10% Dwarfs China's

[beijingwalker]

BTW, it is okay to admit that most of this stuff is above your head. No shame in admitting one's ignorance.

I think it's not above anyone 's head to know that the "experts" from the west has been predicting China's economic crash on weekly basis for 4 decades already, wish you can get it.

 

[Paludism]

It's hilarious how Indians like this specimen are more worried about China's finances than China is. Well, since having money is a problem India will never have, I guess this is how they live vicariously.

Let me take this time to remind my Hindu friends exactly what India is: a window shopper.

"Hindu, you're a window shopper,
Mad at China, I think I know why;
Hindu, you're a window shopper,
Mad as f*ck, when you see China ride by."

http://m.scmp.com/news/china/societ...-top-spot-worlds-big-spender-overseas-tourism

 

[Makarena]

India's Bad Loan Rate Soaring to Near 10% Dwarfs China's
Bank regulators taking steps to help lenders shore up capital

Ballooning non-performing loans at Indian banks are grabbing global attention, while non-performing assets at Chinese peers appear stable. India’s capital market regulator has directed listed companies to report loan and bond defaults within one working day, and authorities are discussing a “package of measures” to help state lenders shore up capital. New mechanisms for dealing with debt disputes and an overhaul in India’s bankruptcy laws will improve bad asset resolution, and non-performing loans have peaked, according to Rajesh Mokashi, managing director at CARE Ratings Ltd.

https://www.bloomberg.com/news/arti...d-loan-rate-soaring-to-near-10-dwarfs-china-s



is another economic crisis on the horizon?

 

[ashok321]

So, some Indians are out to prove Bloomberg wrong?
What an audacity!

Lets see what has Indian media got on this:
India's NPAs: What is RBIs solution for the $154 billion bad loan ...

154 billions = Qatar's GDP.

Lol at Modi worshiping sophomoric sycophants.

 

[N.Siddiqui]

So, some Indians are out to prove Bloomberg wrong?
What an audacity!

Lets see what has Indian media got on this:
India's NPAs: What is RBIs solution for the $154 billion bad loan ...

Bad loans turning into bad debts...

India is borrowing more and more to pay its existing loans, and that could wreck development dreams

The government has set up a cell to manage India's public debt and expects better results than those achieved by the Reserve Bank and the Finance Ministry.

https://scroll.in/article/818686/in...loans-and-that-could-wreck-development-dreams

 

[Keel]

Respected? Yes it is a popular list but what it shows? What does being in a fortune 500 means? And what does it has to do with the debt or credit situation? Care to explain?

For all your banter, you are yet to explain what does all of this has to do with debt / NPA?

Or are you attempting Chewbacca Defense here you little bitch?

The more you talk the more you've exposed yourself into grand showing of ignorance.

You want free ride for a primer on the issues? Get lost unless you quit from the forum for 1 month if I show you all your idocies and shame!

I am leaving the thread anything else I'll come back for more, idiot!

 

[wiseone2]

India's Bad Loan Rate Soaring to Near 10% Dwarfs China's
Bank regulators taking steps to help lenders shore up capital
By
Lianting Tu
and
Anurag Joshi
23 สิงหาคม 2560 08:45 GMT+7

Ballooning non-performing loans at Indian banks are grabbing global attention, while non-performing assets at Chinese peers appear stable. India’s capital market regulator has directed listed companies to report loan and bond defaults within one working day, and authorities are discussing a “package of measures” to help state lenders shore up capital. New mechanisms for dealing with debt disputes and an overhaul in India’s bankruptcy laws will improve bad asset resolution, and non-performing loans have peaked, according to Rajesh Mokashi, managing director at CARE Ratings Ltd.

https://www.bloomberg.com/news/arti...d-loan-rate-soaring-to-near-10-dwarfs-china-s

why is this a problem ?

 

[Jlaw]

I see demonization part 2 coming soon for India

 

[ckf]

I wonder why some Chinese on this forum are so uneducated.

Did anyone care to look at the graph and what it represents? It was bad-loan-rate. Not absolute number of loans or not absolute value of loans.

Let me make it simpler for you...

Read this article :

https://www.cnbc.com/2017/06/28/chi...ising-doubts-over-yellens-crisis-remarks.html

Total internal debt in China is about 3 times that of GDP. That will be about 33.6 trillion dollars. Still smaller whole europe combined, which stands at 97 trillion dollars.
Total internal debt in India is around 2.9 Trillion dollars.

Now about 10 percent of this is bad debt for India. That means 290 billion dollars.
For China, at 2% this will be around 670 billion dollars.

This shows the sheer difference in scales when you look at the whole picture.

Also, Unlike India where this debt is held by private corporates, most of Chinese debt is held by State Owned Enterprises. Which mean, if they go kaput, Chinese govt will have to foot the bill. This makes China's debt a systemic risk. Also, unlike India, accounts of a lot of Chinese banks are never disclosed properly and there is a huge shadow banking system. So, it is almost impossible for someone like bloomberg to even know the complete extant of debt and bad loans in China. We only know the surface.

In case of India, most of these records are open for investigation and the extant of this risk can be estimated. Also, most of this debt is held by private Indian companies and those company's assets will be liquidated and private individuals who are responsible for this will feel the heat. Heck this happened in the case of one of the most publicized Indian billionaire who was running from debt. Selling these assets, a lot of which are in form of commercial land will allow new businesses to replace the old dead ones.

True, banks in both the case will have turbulant times, but unlike China, in case of India it will not be a systemic risk where one company going kaput will topple whole of the financial system.

I didn't know Indian financial geniuses like yourself has any business lecturing the Chinese. All you need to know is China is a capital surplus country while India is capital deficit country requiring foreign financing. China owes 1.46 trillion foreign debt, but also holds 3.08 trillion in reserve with $183 billion outward investment behind only US and 200 billion current account surplus. India owes $470 billion Foreign debt and holds $400 billion in reserves. India runs capital deficit of $10 billion in 2016 and has only $1.8 billion in outward investments in 2016. For a balance view of debt, check out this article:
https://www.bloomberg.com/graphics/2016-china-debt/
Most debt in China is owned by the Chinese, and China's total debt is only half of Japans. Japan managed. If China ever slow down, and global recession ensues...India current deficit would ballon as remittance and FDI contracts. India government would not be able to finance those 2 trillion debt. China would still face tremendous financial strains internally as household wealth contracts, but those debt would be financed locally through monetary easing similar to Japan. India would be running to the IMF for financing and Rupee would join the Vietnamese Dong in devaluation. So India isn't exactly shinning vs China in the debt department.

 

[Skull and Bones]

Banks should start acquiring the collateral for NPAs.

 

[Jlaw]

Banks should start acquiring the collateral for NPAs.

No one wants to buy Indian debt regardless what you call it. You can't repackage Indian debt and sell like US debt. No one wants INR.

 

[Skull and Bones]

No one wants to buy Indian debt regardless what you call it. You can't repackage Indian debt and sell like US debt. No one wants INR.

I'm talking about domestic banks seizing the assets of entities under NPAs.

 

[Keel]

India Government Debt Remains 'Significantly' High, Moody's Says
By Anirban Nag
2017/6/2

India’s general government debt level is "significantly" higher compared with similarly rated countries, Moody’s Investor Service said, firing a fresh salvo at Prime Minister Narendra Modi’s government which has been trying hard to earn a sovereign upgrade.

Rating agencies have India just above “junk” status and while Modi’s government has consistently pushed for a sovereign upgrade in the past few years, Moody’s, Standard & Poor’s and Fitch Ratings have all pushed back, citing high debt levels. On Thursday, Moody’s said that while the general government debt level declined to 67.5 percent of gross domestic product in 2016 from 84.7 percent in 2003, it remains a “key credit constraint.”

Moody’s notes that India’s debt burden is higher than most of its Baa peers including the Bahamas and South Africa. Baa is medium-grade credit risk which may have speculative characteristics, according to Moody’s. Moody’s India rating is at Baa3, the lowest on that rung.

"We view ongoing central government deficit reduction as supportive of India’s credit profile,” Moody’s said in a note. “However, the recent widening of Indian state deficits has more than offset the narrowing of the central government deficit."

Finance Minister Arun Jaitley in his February budget speech reiterated New Delhi’s commitment to fiscal consolidation, pegging the central government fiscal deficit targets at 3.2 percent of GDP for fiscal 2017-18 and 3 percent for 2018-19, down from 3.5 percent in 2016-17.

Moody’s said a new medium-term fiscal framework would help guide the fiscal consolidation process, if adhered to. The new framework, which has been recently proposed, aims to bring down the federal government fiscal-deficit target to 2.5 percent by 2023 while reducing the debt-to-GDP ratio to 60 percent by 2023.

Moody’s was upbeat about India’s move to adopt a unified tax code for goods and services, scheduled to be implemented on July 1.

"Over the medium term, goods and services tax will contribute to productivity gains and higher GDP growth by improving ease of doing business, unifying markets and will enhance India’s attractiveness as a foreign investment destination. GST will also support higher government revenue generation through improved tax compliance and administration," it said.

Nevertheless, the high levels of bad loans in the banking system were a key risk to growth, Moody’s said, adding India would need to resolve it to kickstart the investment cycle.

http://www.msn.com/en-us/money/tops...cantly-high-says-moodys/ar-BBBKXyR?li=AAggbRN

I'm talking about domestic banks seizing the assets of entities under NPAs.

The signal of distress for both the banker and the company in trouble nonetheless.

 

[Skull and Bones]

The signal of distress for both the banker and the company in trouble nonetheless.

Even though I'm not too sure, but waiver of farmer loans should have a role in this.

 

[Keel]

https://www.ft.com/content/4f084b90-0ebc-11e7-b030-768954394623

Air India future in doubt as auditors’ report raises concerns Costly loans spark worries for national carrier that was bailed out
APRIL 6, 2017

Even though I'm not too sure, but waiver of farmer loans should have a role in this.

The waivers to farmers should be regarded as governmental subsidies (assuming the government to take over the responsibilities of payment) to the agricultural sector, similar to the gas subsidies. So I believe it wont be affecting the NPA positions. But it will increase the fiscal deficits.