Shaken PSB Bosses Take NPA Probe Wor­ries to FM Jait­ley

Heads of top 10 banks seek as­sur­ance from min­istry there won’t be witch-hunt

The Economic Times - - Front Page - Our Bureau

New Delhi: Heads of top ten staterun banks met fi­nance min­is­ter Arun Jait­ley on Mon­day to raise con­cerns over ag­gres­sive in­ves­ti­ga­tion into non-per­form­ing loans which they said has im­pacted busi­ness.

A se­nior bank of­fi­cial said the meet­ing was sought by bankers through the In­dian Banks’ As­so­ci­a­tion (IBA) ow­ing to wide­spread fear among bankers af­ter ar­rest of for­mer bank of­fi­cials in the case of King­fisher loans.

“There is al­most a bank­ing paral­y­sis in pub­lic sec­tor banks. We were look­ing to seek as­sur­ance from the fi­nance min­istry that there will be no witch-hunt,” said the of­fi­cial, who sought anonymity.

A fi­nance min­istry of­fi­cial, how­ever, said the meet­ing was held to take stock of the bank­ing sec­tor and steps taken to re­duce non-per­form­ing loans.

“A host of is­sues came up for dis­cus­sion, in­clud­ing cap­i­tal needs of banks and im­pli­ca­tions of GST,” said a min­istry of­fi­cial. He said Jait­ley also dis­cussed the prob­lems faced by banks in faster res­o­lu­tion of stressed as­sets.

Stressed loans of banks are esti- mated to have crossed 20% of the gross ad­vances.

Bankers that at­tended the meet­ing in­cluded Arund­hati Bhat­tacharya, chair­man of State Bank of In­dia, Usha Anan­tha­sub­ra­ma­nian, MD of Pun­jab Na­tional Bank, and IDBI CEO Kishor Kharat.

“We are also gear­ing up for an­other new model launch this year. Apart from this, we will con­tinue to sup­port the ‘Make in In­dia’ ini­tia­tive.”

Ford In­dia’s out­put ex­panded 41% to 2.42 lakh units in 2016, led by de­mand for the EcoS­port in over­seas mar­kets, apart from the new Figo and As­pire mod­els in­tro­duced in the do­mes­tic mar­ket. “Ford has been mak­ing in In­dia for In­dia and the world and is proud to demon­strate its strong com­mit­ment — from cre­at­ing jobs to de­vel­op­ing tal­ent — in In­dia,” said Anurag Mehro­tra, ex­ec­u­tive direc­tor for mar­ket­ing, sales and servi- ce. “We have con­tin­ued to stay com­mit­ted to build­ing and strength­en­ing In­dia as a cen­tre of man­u­fac­tur­ing ex­cel­lence with prod­ucts ex­ported to more than 50 mar­kets across the globe.”

Com­pa­nies in In­dia, led by Maruti Suzuki In­dia Ltd and Hyundai Mo­tor In­dia Ltd, made more than 34 lakh pas­sen­ger ve­hi­cles in 2015-16, ac­cord­ing to the So­ci­ety of In­dian Au­to­mo­bile Man­u­fac­tur­ers. They ex­ported 653,889 cars that year, or about 19% of the out­put.

Healthy growth for Re­naultNis­san and Ford is crit­i­cal be­cause most in­ter­na­tional car mak­ers in In­dia have ac­cu­mu­lated losses. Ford’s lo­cal ri­val Gen­eral Mo­tors In­dia started sig­nif­i­cant ex- ports in 2016, which helped the maker of Chevro­let cars reg­is­ter an 88% growth in pro­duc­tion in the coun­try.

An­other mile­stone was crossed in 2016. Nine of the top 10 car­mak­ers in In­dia pro­duced over 1.4 lakh units each, in­di­cat­ing that they are achiev­ing a cer­tain scale in man­u­fac­tur­ing, boosted by ex­ports.

Still, Re­nault-Nis­san’s plant in Ora­gadam, Chen­nai, which started func­tion­ing in May 2010, ac­counts for only 3% of the al­liance’s global pro­duc­tion of al­most 10 mil­lion units. The plant has the ca­pac­ity to build 480,000 cars per year.

Ford has man­u­fac­tur­ing fa­cil­i­ties in Chen­nai and Sanand, Gu­jarat, with a ca­pac­ity of 440,000 ve­hi­cles.

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