Prime Minister Narendra Modi (Getty Images)
Prime Minister Narendra Modi (Getty Images) 
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Strict Action Against Financial Irregularities, Says Modi Hinting At PNB Scam

BySwarajya Staff

Prime Minister Narendra Modi made his first comment yet on the Rs 11,500 crore Nirav Modi scam involving Punjab National Bank (PNB), saying the government will take strict action against irregularities in financial matters.

Addressing the Global Business Summit organised by the Economic Times, on Saturday (24 February) Modi said illegal accumulation of people’s money was unacceptable. “This is the basic mantra of New Economy – New Rules,” he said.

This is Modi’s first public statement since the scam involving PNB and other national banks broke out two weeks ago. A couple of other problems faced by banks from companies like Rotomac and a Delhi diamond exporting firm have also come out in the open since the Nirav Modi issue burst out in the open.

But for these comments, the Prime Minister stayed the course with his views on the economy and the progress the country has made under his government over the last four years.

“A definite change is now visible. This change in the economic and social content represents the essence of the new rules for the new India and the new economy,” Modi said, adding that the country is performing better on various macro-economic parameters.

Modi’s hint on the PNB scam comes at a time when the Opposition, led by the Congress, has been demanding a statement from him. In particular, Congress president Rahul Gandhi has been tweeting on the issue with the latest being a suggestion to tell the people how the billionaire diamantaire “looted and scooted” in his monthly “Mann Ki Baat” programme.

On 23 February, Congress leader Anand Sharma alleged that the Modi government “promoted private firms in diamond purchase pacts with Russia in 2015 over public sector units like MMTC and Hindustan Diamonds”.

On its part, the Bharatiya Janata Party has charged the Congress with sanctioning loans to Nirav Modi and Gitanjali Diamonds owner Mehul Choksi, Nirav’s uncle and a co-accused in the PNB scam. It also alleged that the Congress began favouring Nirav Modi from 2008.

Nirav Modi has responded to the allegations, saying the PNB rushing to the media with details has affected his brand and his chances of settling the dues. Choksi, on the other hand, has written to his employees that he has done nothing wrong.

The Central Bureau of Investigation and the Enforcement Directorate, which are probing the issue, have questioned over two dozen people and arrested over half a dozen persons in connection with the scam.

Nirav Modi got the PNB’s Brady House branch in Mumbai to issue him unauthorised letters of undertaking (LoUs) or bank guarantees for availing of loans abroad for his business. The guarantees were given without any collateral. The practice continued for years until it came out in the open recently when one of the bank officials involved in the illegal issue of LoUs retired.