Transparency shall prevail

Supreme Court's verdict on Reserve Bank of India's disclosure of RTI-related inquiry is not just a matter of petitioner's interest or selectively denied information but a question of curtailed transparency in the national interest from the central bank. RBI's denial to disclose information regarding wilful defaulters and annual inspection report on commercial banks under the RTI despite the Supreme Court's order in December 2015 brings forth poor compliance of law and order. However, RBI survived the contempt proceedings and the contempt petition turned into one final warning to disclose the withheld information. Holding the regulator's non-disclosure policy in violation with its 2015 judgement, the apex court informed RBI that any further "violation shall be viewed seriously". Ignoring the 2015 verdict, RBI had denied information regarding inspection reports of ICICI Bank, Axis Bank, HDFC Bank and State Bank of India in January 2016 citing exemption under the Reserve Bank of India Act and RTI itself. Both the Supreme Court as well as the Chief Information Commission had held that RBI cannot deny information under RTI unless the material demanded is exempted from disclosure under law. RBI's argument constituted 'fiduciary' and 'economic interest' as grounds for refusal. But SC had clarified in 2015 itself that the central bank cannot withhold information under the guise of confidence or trust with financial institutions and is accountable to provide the information sought by the public. An air of contempt should have never made it to the halls of the regulator but for vested interests. The privilege of exemption that RBI has been deliberately enjoying since 2015 is an outright contempt of court and strangely took four years to be addressed. Not that the general public flooded the central bank with inquiries of this sort but what may move the entire issue drastically is the outstanding amount of bad debts that the country's lenders hold before it. Rs 10 lakh crore of NPAs plague the consortium of lenders significantly impacting their ability to lend more. As the progression of Indian businesses and the economy, in general, is concerned, lenders have played a crucial loan in building businesses and industries from scratch. Lending capacity plays a pivotal role in spurring economic growth. But recent years have witnessed declining health of financial institutions due to mounting NPAs citing the most-recent figure at Rs 10.25 trillion for FY 2018. It is interesting to note that the finance ministry in February announced a capital infusion of Rs 48,239 crore in 12 PSBs taking the total capital infusion for 2018 to Rs 1.06 lakh crore. While there has been a ruckus over the government allegedly writing off bad debts of fugitive economic offenders who have fled the country through this recapitalisation plan, withholding precise information regarding defaulters motivates the public to believe this. The grounds on which RBI has till now withheld information is also not exactly plausible. Citing fiduciary in this matter feels inadequate since seeking information regarding defaulters in the quest for transparency does not stand in violation of banks' confidentiality. It does not hurt their reputation as much as concealing the names of defaulters in this regard. The public ought to be aware of matters that have a snowballing effect on the economy itself. 10 trillion rupees in bad debt is potentially a disastrous situation and RBI's transparency in listing details of the same is a move that can garner the trust of masses. Having powers to inspect lenders both private and public, RBI has a huge responsibility to apprise the public regarding the economy's big debts.

Beyond the ambit of the economy, there is the potential political front which stands unexposed due to RBI's non-disclosure policy. The disclosure of say defaulters' name alone apprises the public and empowers them to be careful. We have already seen big names in the market come crashing down with huge NPAs to their name and that has kept us aware of the ramifications of huge loans and faulty policies. Jet, Kingfisher, et al are cases in point. Nirav Modi, Sandesara brothers being the few examples. Without these cases, both the credit health of lenders and economic activity would undoubtedly be soaring, at least better than the present. Apart from being a mock at the law and order, RBI's denial points at dubious inferences such as shielding defaulters and withholding information under the garb of "exemption" to protect interests. Even the existence of such apprehensions in thought is a sense of injustice in a democracy let alone the possibility of it being real which could lead to cracks in public faith. SC's verdict is a firm slash of Lady Justice's sword on RBI's active violation of its verdict which clearly upholds public interest and urges the central bank to review its information disclosure policy relating to banks under RTI, reminding it that "it is duty-bound under the law".