Flaunting of wealth doesn't matter, say Bibek Debroy, Arvind Subramanian

NEW DELHI: Days after RBI Governor Raghuram Rajan warned bank defaulters against flaunting their wealth, Chief Economic Advisor Arvind Subramanian and NITI Aayog Member Bibek Debroy today appeared to suggest that "flaunting" of riches should not be a matter of that much concern.

Debroy said assets and liabilities of an enterprise can be delinked from those of individuals, which is entirely a limited liability concept.

"I think wealth creation is good for society and wealth creation is good for everyone. You make tonnes of money and you go and flaunt it. It's none of my business," he told NDTV.

Debroy did not directly comment on display of wealth by the rich who have defaulted on bank loans.

Both were asked to respond to Rajan's recent warning to wilful defaulters.

In Davos, Rajan had said rich businesses owing large sums to banks should behave and not flaunt "massive birthday bashes" while still in serious debt.

When the question was put to Subramanian, the CEA said: "I have no views on flaunting. We address owing the money problem, not flaunting... Flaunting, I agree with Bibek."

To deal with the problem of debt, he said the country needs legislations like the bankruptcy law which has been introduced in Parliament and other mechanisms for "fairly apportioning the cost of decisions made in past" among all stakeholders.

"This is a private matter," Subramanian said when asked if he was saying how people spend their money is their own business even if they are in debt.

The gross NPA of public sector banks rose to 6.03 per cent of total advances as of June 2015, from 5.20 per cent in March 2015.