Prime Minister Narendra Modi on Wednesday took a jibe at his predecessor Manmohan Singh, saying that the crisis surrounding India’s banking sector was the biggest liability that the BJP government had inherited from the UPA government’s “economists”.
“NPA (non-performing asset) is biggest liability given by the previous government’s economists,” Modi said at industry body Federation of Indian Chambers of Commerce and Industry’s (FICCI) 90th annual general meeting.
“When some in the government pressurized the banks to give loans to select businesses, was FICCI doing anything then? Did FICCI raise its voice then?” he asked.
Giving out loans arbitrarily and without due diligence was the biggest scam of the previous government, Modi said, instead of the seemingly bigger ones like the Commonwealth Games scam, the Coalgate scam and the 2G spectrum scam.
The government is now taking various steps to bring the banks out of the bad loan mess, he said.
Banks, especially state-owned ones, are in the process of a revival, after a pile-up of bad loans negatively impacted their growth. Non-performing assets held by Indian banks at the moment stand at around Rs 10 lakh crores.
Regarding the ongoing controversy and confusion surrounding the Financial Resolution and Deposit Insurance (FRDI) Bill, 2017, the Prime Minister said that these were nothing but ‘rumours’.
“Nation can be secured when its banks and depositors are,” Modi said.
“The government is working towards protecting interest and rights of depositors but rumours being spread are totally opposite. Contribution of institutions like FICCI are important to dispel such rumours,” Modi said.
He further said that the government has brought about 87 major reforms across 21 sectors in last three years. There have been new policies in multiple sectors including aviation, defence, financial services, food processing and real estate.Pointing out the various ongoing reforms undertaken by the government, Modi said that he wants more people to a part of the new indirect tax regime—Goods and Services Tax (GST).