In the wake of mounting bad loans in the banking system, Minister of State for Finance Jayant Sinha has said that the banks have initiated 10-12 strategic debt restructurings involving about Rs 1 lakh crore.
“We have given freedom to banks to bring in strategic partners in case of stalled project. We have enabled banks to undertake strategic debt restructuring (SDR). Under this, there are some 10-12 cases wherein new promoters have been brought in and about Rs. 1 lakh crore loan is being restructured,” he said.
During the previous UPA Government’s ruling, Sinha said, “there was policy paralysis as well as crony capitalism.
“We have to make banks stronger. We have also taken many steps to ensure that this does not get repeated,” he added.
As of September 2015, the gross NPAs of public sector banks had increased to Rs. 3.01 lakh crore as against Rs. 2.67 lakh crore in March.
Sinha further said that private investment will revive once the government’s steps to address the bad debt problem as well as sector specific constraints bear fruit.