Zee Media Bureau
New Delhi: Finance Minister Arun Jaitley on Friday said that the economy is recovering from serious challenges it faced in the last few years adding that banks would cut rates further over the next few months.
Addressing the media after meeting with the heads of PSU banks, the FM said, “Expect banks to pass on the benefits of rate cut”.
Reserve Bank has cut repo rate by 0.75 percent since January but not all banks have passed on the benefit of lower interest rates to customers.
The FM met with PSU heads to review their performance and bad loans situation as also to persuade them to pass on RBI's rate cut benefit to borrowers for propping growth.
“Corporate credit is yet to pick up, non-performing assets (NPAs) have come down 5.2 percent as of March 2015 though one quarter does not indicate the pattern,” FM said.
Jaitley also added that the government is talking to states to address issues of stalled projects. “We will call for a meeting of concerned department and resolve the issue of stall projects,” Jaitley said.
The FM further added that government spending in infrastructure has increased significantly. He said, “We are on a road map of much higher growth. Revenue projection of government is more comfortable."
Jaitley also deliberated on the issue of NPAs and discuss ways to contain this. Gross NPAs of PSU banks have gone up to Rs 2,60,531 crore as on December 2014, as per the RBI data.
“ I have discussed road map for reducing stress in balance sheets with regards to NPAs. Banks have put up a strong case for additional capital requirement,” he said.
