During a discussion in the Rajya Sabha, Finance Minister Nirmala Sitharaman addressed concerns regarding non-performing assets (NPAs) and underscored India's position as the world's fastest-growing economy. She highlighted that the issue of NPAs was rooted in the practice of "Phone Banking" during the UPA rule from 2004 to 2014.
This practice involved political interference, leading to unwarranted loans being granted without proper assessment, significantly impacting the Indian banking sector.
Sitharaman emphasized that the burden to rectify this situation fell on the subsequent government, and significant efforts were made in collaboration with the RBI to address these challenges. This included reforms and initiatives to tackle the twin balance-sheet problem, which had an adverse impact on the economy during that time.
Regarding steps taken against wilful defaulters, she mentioned the proactive measures implemented. Legal action, including the filing of cases, has been pursued against several defaulters, with a substantial amount recovered as of March 31. Additionally, actions under the Prevention of Money Laundering Act (PMLA) led to the return of funds to banks and the confiscation of assets by the Enforcement Directorate (ED) amounting to Rs 15,186.64 crore as of December 1.
Sitharaman's response aimed to highlight the government's efforts in rectifying the NPA issue, ensuring legal action against defaulters, and the recovery of funds, showcasing steps taken to address the concerns raised in the Rajya Sabha.
(With Agency Inputs)
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