New Delhi, June 12 (IANS) The finance ministry will, over the next few weeks, prepare a list of projects stalled due to lack of finance to set in motion the process of their revival and thus bring down the non-performing assets, or distressed loans, of banks, Finance Minister Arun Jaitley said on Friday.
“Many stalled projects have started. The secretary, department of financial services, in consultation with others, will prepare a list of projects stalled because of finance,” Jaitley told reporters here after meeting with the heads of public and private sector banks.
“We will deal with these stalled projects directly. We will call representatives of state governments, of the projects and the departments concerned over the next few weeks,” he said.
“In the fourth quarter of January to March 2015, NPAs had come down from 5.64 to 5.2 percent. But, as I’ve said earlier, one quarter doesn’t indicate the pattern… I would like to wait,” Jaitley added.
Reporting that the heads of banks said they would take another two to three quarters to reach “a somewhat greater level of comfort” on NPAs, the finance minister said that “banks will have to make greater effort to reduce NPAs and those with higher levels were asked to explain the reasons for it”.
Gross NPAs of state-run banks have gone up to Rs.260,531 crore as on December 2014.
As per the ministry’s Economic Survey published before February’s union budget, stalled projects as on December-end amounted to Rs.880,000 crore-worth.
Meanwhile, Reserve Bank Deputy Governor S.S. Mundra said here on Thursday that Indian banks should recognise NPAs early and help the borrower, while keeping distressed loans under wraps would be injurious to all.
Noting that an account turning into an NPA is not a sin, he said that when an account turns sticky, then the banks should recognise it fast in its books and try to help out the borrowers.