The Reserve Bank of India (RBI) has listed 2,664 companies as wilful defaulters who have collectively failed to repay loans amounting to Rs 1.96 lakh crore as of March 2024, despite having the means to do so. 

This trend raises concerns about the financial health of India’s corporate sector and the potential risks posed by them to the banking system.

As per the RBI data, fugitive diamantaire Mehul Choksi-owned Gitanjali Gems topped the list of defaulters, owing Rs 8,516 crore. In 2018, Choksi and his nephew Nirav Modi had fled India after an FIR was filed against them for committing loan fraud involving the Punjab National Bank. 

ABG Shipyard, promoted by Rishi Agarwal, occupied the second spot with an outstanding amount of Rs 4,684 crore. The company, a major player in the shipbuilding industry, defrauded 28 banks to the tune of over Rs 22,800 crore. This is one of the biggest bank fraud cases in the country.

Replying to the Right to Information (RTI) queries filed by The Indian Express, the RBI named the top 100 corporate defaulters, excluding individuals and foreign entities. 

The other defaulters in the top 10  include Concast Steel & Power (Rs 3,557 crore), Era Infra Engineering (Rs 3,507 crore), SEL Agro (Rs 3,367 crore), Winsome Diamonds & Jewellery (Rs 3,356 crore), Transstroy (India) (Rs 3,261 crore), Rotomac Global (Rs 2,894 crore), Zoom Developers (Rs 2,217 crore), and Unity Infraprojects (Rs 1,987 crore).

The data also revealed that the number of wilful defaulters has risen steadily over the past four years, climbing from 2,154 in March 2020 to 2,664 in March 2024. The amount of unpaid dues has spiked from Rs 1,52,860 crore to Rs 1,96,441 crore during this period.

According to the RBI, a ‘wilful defaulter’ is a borrower or guarantor who has the financial capacity to pay but has deliberately not honoured it, by diverting or siphoning funds away from the intended projects.

Earlier this year, the RBI issued new norms for wilful defaulters. Coming into effect since November, lenders are required to examine such defaulters in all non-performing assets (NPA) accounts with an outstanding amount of Rs 25 lakh and above, and complete the process within six months. 

Investigations into the borrowers on the list are ongoing, involving agencies such as the Serious Fraud Investigation Office (SFIO), the Enforcement Directorate (ED) and the CBI, especially in cases involving fund diversion or fraudulent practices.