crore out of the total restructured portfolio of R9,717 crore as on June 30, 2013.
Another PSU lender, Syndicate Bank, also says it is conservative and “generally not taking any interest” in projects unless there is major involvement of the Central government.
"Banks indeed became very cautious on cash lending to the infra projects. As a result, credit to infrastructure projects in this financial year is definitely coming down,” said Bhavik Damodar, partner, transaction services, KPMG, in India. Apart from concerns over existing projects, the lack of too many fresh projects will lead to a slowdown in infrastructure lending.
"Nothing is coming on the board, except road projects,” said Arun Tiwari, executive director, Allahabad Bank. Even the road projects coming up are under PPP mode with participation from the government, added Tiwari.
Senior IDBI officials agreed that ‘macro-level’ numbers of fresh infra projects were dwindling.
During 2012-13, outstanding bank credit to the infrastructure sector stood at R7,86,045 crore, with the major chunk coming from public sector banks. This apart, credit had also come into the sector via NBFCs. But this fiscal credit growth from the finance companies is not forthcoming either.
Hemant Kanoria, CMD of Srei Infrastructure Finance, said there was a slowdown in infra lending due to ‘non-clarity and ambiguity’ in government policies.
"No funding is available for infrastructure projects either through debt or equity. We had urged the government to allow infra finance companies to get listed overseas, but it is still to take a decision,” Kanoria told FE. He dubbed the Centre’s move to infra projects worth R1.83 lakh crore as “a few drops in the ocean”.
* SBI says it is ‘cautious’ in financing to infrastructure sector and is lending only to the major companies
* Infra projects are being delayed on land acquisition, environmental clearances and fuel linkages issues leading to cost overruns
* Banks are concerned any further lending to the infrastructure space could add to asset quality risks