Arun Jaitley hints crackdown against bad loans, says someone else should be allowed to take over if private sector cannot pay debts

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New Delhi | Published: August 31, 2017 11:11:29 AM

Finance Minister Arun Jaitley on Thursday morning hinted at a crackdown against bad loans in India. He said that finding a solution to this crisis will take time but at the same time he issued a warning to the private sector by saying that if it cannot pay back its debts someone else should be allowed to take over.

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While speaking to media, Finance Minister Arun Jaitley on Thursday morning hinted at a crackdown against bad loans in India. He said that finding a solution to this crisis will take time but at the same time he issued a warning to the private sector by saying that if it cannot pay back its debts someone else should be allowed to take over. “You can’t have a surgical solution to it. If private sector cannot pay back its debts then someone else should be allowed to take over,” Jaitley was quoted saying by PTI. The Finance Minister further added that the RBI has already recommended banks to initiate insolvency proceedings against 12 large defaulters.

Talking about the recently implemented Goods and Services Tax (GST), Jaitley said its inflationary impact has been avoided and there is a scope of convergence of tax rates going forward. He added that GST combined with demonetisation will give a boost to direct tax revenues as many people have come under the tax net. The minister also said that consolidation of PSU banks is on cards as the country needs fewer but stronger banks.

Reacting to the RBI annual report which had suggested that about 99 per cent of Rs 15.44 lakh crore demonetised currency came back into the system, Jaitley said that fall out of demonetisation was on predicted lines and the economy will benefit in the medium and long term. He added that the fact that money got deposited in banks does not mean that all of it is legitimate money. “The fallout of demonetisation is on predicted lines, the fact that money got deposited in banks doesn’t make it legitimate money,” he said.

“It’s nobody’s case that black money has been completely eliminated after demonetisation,” Jaitley added. The senior BJP leader said that it is not a concern for the government as it is good for the economy that more money has come into the formal system.

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