With over Rs 18 lakh crore worth of projects stalled, Arun Jaitley has called a meeting with chiefs of public sector banks on April 28 to discuss measures to remove bottlenecks that hamper the implementation of infrastructure projects.
“The level of non-performing assets (NPAs) and the stressed projects of public sector banks (PSBs) have been showing an upward trend in the last four quarters, the department of financial services is going to hold a meeting of CMDs of PSBs on 28th April, 2015 at the Reserve Bank of India office in Mumbai,” said an official release on Sunday.
Senior officials of the RBI along with officers from implementing ministries will also attend the meeting that will undertake a case by case review of some of the major projects in sectors such as power, roads, shipping and steel.
“The objective of this meeting is to understand the problems faced by the project promoters and the banks in retrieving them and to find out a solution to such problems,” said the release, adding that it would help the department of financial services to crystalise actions required by banks, finance ministry and other concerned central ministries as well as support required from the RBI.
At present, there are 632 projects with the project monitoring group of the Cabinet Secretariat for resolution of various issues.
According to a report prepared by the finance ministry for its last review meeting with PSBs in March this year, a total of 299 mega projects involving an outlay of Rs 18.13 lakh crore were stalled.
One of the major reasons for rising non-performing assets (NPAs) for PSU banks is non-implementation of infrastructure projects for reasons like fuel linkage, environment clearance, land acquisition issue etc. The level of NPAs and the stressed projects of the public sector banks have been showing an upward trend in the past four quarters.
As per the RBI data, gross NPAs of the PSU banks have gone up to Rs 2,60,531 crore as on December 2014.
Gross NPAs of public sector banks rose sharply to 5.33 per cent in September 2014 as compared with 4.72 per cent of total advances at the end of March 2014.