The Centre is planning to infuse Rs 70,000 crore into public sector banks (PSBs) by 2018-19 to address the issue of bad loans.
The government has decided to infuse Rs 20,000 crore in the current fiscal year, followed by Rs 25,000 crore in FY17 and Rs 10,000 crore each over the subsequent two years.
The capitalisation plan is likely to strengthen balance sheets of PSBs having high non-performing assets and bad loans.
Finance Minister Arun Jaitley said, “The capitalisation plan for state-run banks is a crucial step to push growth and address the issue of bad loans.”
The government had initially proposed Rs 7,940 crore for capital allocation to state-run banks.
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