FM reviews PSBS’ preparedness to implement stimulus
nNEWDELHI:FINANCE minister Nirmala Sitharaman on Friday reviewed the readiness of public sector banks (PSBS) to implement the ₹20,97,053 crore economic stimulus package announced between March 26 and May 17, the finance ministry said.
The finance minister chaired the review meeting through video conference with the chief executives of PSBS, the ministry said in a tweet.
Department of financial services (DFS) said the meeting was held to operationalise the announcements made to provide relief to the poor and stimulate the economy. “Everyone aligned on the need for quickly addressing the needs of MSMES [micro, small and medium enterprises] and other customers,” it said in a tweet. Operational details will be released soon, the DFS added.
The government on March 26 announced a ₹1.70 lakh crore welfare package under the Pradhan Mantri Garib Kalyan Yojana (PMGKY). It was followed by monetary measures worth ₹8.01 lakh crore taken by the Reserve Bank of India (RBI) between March 27 and April 17. Recently, Sitharaman announces an additional ₹11.02 lakh crore stimulus package in five-parts between May 13 and May 17 under an overall umbrella of Atmanirbhar Bharat Abhiyan (Self-reliant India Initiative).
PSBS play key role in effective implementation of most of the announcements the government made since March 26, hence the finance minister will frequently review the progress made by state-run banks in this direction, two finance ministry officials said requesting anonymity.
Most of the schemes are executed through PSBS and banks are directly responsible for welfare schemes that involve direct benefit transfer, one of the officials said. A second official said the government is also monitoring the credit flow, which is a must to boost the economy.
nMUMBAI:KKR and Co. Inc. said on Friday it will invest ₹11,367 crore in Reliance Industries Ltd’s (RIL’S) digital assets subsidiary Jio Platforms Ltd, in what would be its single-largest investment in Asia so far.
The deal will fetch the New York-based private equity (PE) giant a 2.32% stake in Jio Platforms, which is in a capital raising spree, having swung five hefty share sale deals in just a month’s time, including the latest transaction.
For Jio Platforms, KKR’S investment will take Mukesh Ambani-promoted RIL closer to its target of shedding net debt worth ₹1.53 lakh crore by March 2021. RIL has managed to get investment commitments from five marquee global investors that will help it repay more than half of its net debt.
This is significant, given the deals were struck in a subdued equity market due to the Covid-19 pandemic. Many of these investment discussions were initiated at least six months ago.
Together, the five deals allow Jio Platforms to raise about ₹78,561.75 crore.
Facebook’s April announcement that it would invest $5.7 billion for a 9.99% stake in Jio was quickly followed by $750 million from Silver Lake and $1.5 billion from Vista Equity Partners. On 17
May, Jio Platforms said it was raising $870 million from another New York-based private equity powerhouse, General Atlantic.
For KKR, the investment in Jio is a bet on growing digitisation, with more and more consumers spends moving to online from offline and Jio’s holistic approach in tapping the digital opportunity of the Indian market.
“If you look at the rationale, there are several layers of opportunities: you’ve got strong, foundational infrastructure, highquality technology infrastructure, and most of the investment (by Jio) has already been made,” said Sanjay Nayar, chief executive officer of KKR India.
“Among their initiatives has been the bundling of more digital services with their own smartphone devices and the Myjio app—and offering these bundled services to Indian consumers at a really affordable price. On top of that, you have this incredibly rich enterprise story and its assistance to small businesses, as well as the e-commerce and digital opportunity.”
Nayar pointed out that Jio’s efforts come at a time when India is digitising rapidly. “Digitisation has been a major focus, and it is the only efficient way to reach Indians in rural India. And if you can deliver services to people at the right affordability levels, they will take the opportunity. That is a strong thesis here.”