Govt, RBI taking tough action to recover bank dues: PM Modi

Amid rising concern over default by large borrowers like liquor baron Vijay Mallya, Prime Minister Narendra Modi today stressed that the government as well as RBI is taking "tough action" to recover loans from corporate defaulters.

"The only segment showing an increase in (corporate rating) downgrades is highly leveraged large firms. The government and Reserve Bank have taken tough action to recover dues from large corporate defaulters. Perhaps the noise from this segment has influenced media perceptions," he said at Bloomberg India Economic Forum here.

Gross Non Performing Assets (NPAs) of public sector banks (PSBs) increased from Rs 2,67,065 lakh crore in March last year to Rs 3,61,731 lakh crore in December.

There was an increase of Rs 94,666 crore over the nine months of the current fiscal.

The gross NPAs of PSBs increased from 5.43 percent as on March last year to 7.30 percent in December.

Even Finance Minister Arun Jaitley in a stern warning to wilful defaulters had yesterday said they should settle dues honourably with the banks or else be ready to face "coercive action" by lenders and investigative agencies.

"I don't want to make any comments on individual cases but I think it's a responsibility of large groups like his (Vijay Mallya's) to honourably settle their dues with the banks," he said.

Prime Minister said there has been a smart pickup in credit growth after September.

"Credit off-take between February 2015 and February 2016 increased by 11.5 percent. The overall fund flow to corporate sector through equity and borrowings of various kinds, domestic and foreign, has increased in first three quarters of 2015-16 by over 30 percent," he said.