Loan defaults: Adopt ethical approach, Jaitley asks industry
Amid rising cases of wilful default on loans, including the one by liquor baron Vijay Mallya, Finance Minister Arun Jaitley today said industry is fighting a battle of credibility and it should adopt positive and ethical approach towards NPAs or bad debts.business Updated: Apr 04, 2016 17:37 IST
Amid rising cases of wilful default on loans, including the one by liquor baron Vijay Mallya, Finance Minister Arun Jaitley on Monday said industry is fighting a battle of credibility and it should adopt positive and ethical approach towards NPAs or bad debts.
“Indian industry is also fighting a major battle for its own credibility. Some recent events haven’t added to their credibility,” he said, without naming Mallya who has defaulted on Rs 9,000 crore loan and has gone to the UK to avoid action by investigative agencies and lenders.
“In this entire debate which is going on non-performing assets, I am quite conscious of the fact that an adverse business environment can lead to non-performing assets.
“When the cycle reverses, the NPAs can also be reversed but the approach of the leaders of the industry will certainly have to be always positive and ethical because it is that approach which is going to add to their credibility,” he said while addressing while addressing the CII Annual session here.
There are about 7,686 wilful defaulters who owe Rs 66,190 crore to public sector banks. Of these, suits have been filed in 6,816 cases and FIR has been lodged 1,669 cases.
Banks have initiated action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (Sarfaesi) Act in 584 such cases.
Jaitley also said the government has been trying to address the problem of NPAs in sectors like steel, textile, highways and infrastructure, which are on account of economic slowdown.
“In the last one year, pro-active steps have been taken as far as steel industry is concerned, the revival of highway industry is concerned, the sugar industry is concerned, the step which has been taken in power sector, each of these are going to lead to better consequence as far as these sectors are concerned in coming one year,” he said.