New Delhi: The government today announced an aggressive Rs 2.11 lakh crore capital infusion for the NPA hit public sector banks over a period of two years.Out of this,Rs 1.35 lakh crore will be through the recapitalisation bonds while remaining Rs 76000 crore from budgetary support,Finance Services Secretary Rajiv Kumar said here.
Addressing media,Finance Minister Arun Jaitely said the capital infusion would be done over the next two years.He also said the capital infusion would be accompanied by series of banking reforms which would be spelt out in the next few months.
The nature of the bond and details of the bonds would be made public during course of time,he said.
Non-performing assets have increased from Rs 2.75 lakh crore in March 2015 to Rs 7.33 lak crore as of June 2017.
The finance minister said banks would get Rs 18000 crore under the Indradhanush plan.Under Indradhanush roadmap introduced in 2015,the government had announced to infuse Rs 70000 crore in PSBs over four years to meet their capital requirement in line with global risk norms,known as Basel-3.
In line with the plan,public sector banks were given RS 25000 crore in 2015-16,and similar amount has been earmarked for the following years.Besides Rs 10000 croreeach would be infused in 2017-18 and 2018-19.
Meanwhile, Finance Minister Arun Jaitley today said the Indian economy is on a strong wicket with sound macro-economic fundamentals. At a press briefing to detail state of the economy, he said India has been the fastest growing major economy for the last three years and the attempt is to maintain high growth rate in coming years.
In a presentation made at the briefing, Economic Affairs Secretary S C Garg said inflation has consistently come down since 2014 and will not cross 4 per cent this fiscal. Detailing macro-economic fundamentals, he said that current account deficit will be less than 2 per cent this year and foreign exchange reserves have crossed USD 400 billion.
On fiscal deficit, he said the government is committed to sticking to the target of 3.2 per cent of GDP for the current fiscal but a review would be done in December. Stating that the GDP growth slowdown has bottomed out and the economy is turning around, he said the International Monetary Fund (IMF) had recently projected that the country would achieve a 8 per cent growth rate soon.
Garg further said that the government is confident of surpassing the disinvestment target of Rs 72,500 crore for this fiscal. Finance Secretary Ashok Lavasa said that total government expenditure so far this fiscal has been Rs 11.47 lakh crore out of Rs 21.46 lakh crore budgeted for this financial year.
Out of capital expenditure target of Rs 3.09 lakh crore,Rs 1.46 lakh crore has already been spent. Central public sector units have spent an additional Rs 1.37 lakh crore out of their target of Rs 3.85 lakh crore.
Lavasa said 83,677 km of road will be built in the next five years. Banking sector non-performing assets (NPAs) rose from Rs2.75 lakh crore in March 2015 to Rs 7.33 lakh crore as on June 2017, Department of Financial Services Secretary Rajiv Kumar said. Of that Rs 1.75 lakh crore relates to just 12 cases which have been referred to NCLT.