Fiscal situation likely to be better in 2012: SBI Head

What a year it has been for the Indian banking sector, and the road ahead too doesn't seem to be very smooth. Every macro economic indicator got worse, perhaps worse than we have ever seen it except the six months post Lehman. Inflation has been above 9% for all the months of 2011 and GDP too, for the first time in 11 quarters, dipped below the 7% mark.

Fiscal deficit also is at the worst ever level since the crisis. Every year, borrowings have been ascending in sequence from over Rs 1 lakh crore to Rs 3 lakh crore and this year, the fiscal gap might just be as high as Rs 5 lakh crore.

While every macro economic parameter is looking difficult, perhaps the most important one will be growth. CNBC-TV18 catches up with the chairman of the country's biggest bank, Pratip Chaudhury of SBI to get a sense of where the economy is headed in 2012.

He points out to projects are stuck because the companies are unsure of profitability. Chaudhury agrees that investment sentiment is currently down in the dumps and says that PSUs must take the initiative to spruce up the climate.

As for his own bank, SBI