He warned the lenders that indiscriminate lending could inflate the level of bad loans in future.
Cautioning the banks against the growing credit at a high rate of 28-31 per cent, the minister feared the further growth of NPAs.
“If we have growth on the basis of 31 per cent or 28 per cent credit offtake, history will record it as growth on the back of indiscriminate lending,” he said while addressing the banks at the annual general meeting of the Indian Banks Association.
“One lesson that all of us must learn — moderation, rather than just running after numbers,” Jaitley added.
Higher growth rate must be supported well by good macroeconomic fundamentals. Economy should be managed well by maintain the fiscal prudence of the growth and reasonable credit offtake, he explained.
He termed volatile oil prices and trade wars as external risks that impacted the economy of India. The minister also cited one of the sporadic issues pertaining to Turkey that hampered the prices of Indian currency, as compared to $.
Arun Jaitley has recently rejoined the office as the Union Finance Minister after being on a medical leave for about three months.