Union minister Nitin Gadkari on Friday claimed proactive steps taken by the government in the road sector have helped save Rs 3 trillion of loans from slipping into bad assets.
As banks work overtime to resolve dud loans worth over Rs 8 trillion, Union minister Nitin Gadkari on Friday claimed proactive steps taken by the government in the road sector have helped save Rs 3 trillion of loans from slipping into bad assets.
"With the cooperation of the finance minister and the prime minister, we took 22 Cabinet decisions, and conducted meetings day and night. Because of that, today there is a situation where we've saved banks from Rs 3 trillion of NPAs," Gadkari told reporters.
The minister, who was here to attend the listing ceremony of Cochin Shipyard, said infrastructure was a "challenge" when the NDA government came to power in May 2014, when 403 stalled road projects, with a banking system exposure of Rs 3.85 trillion, were on the verge of becoming non- performing assets.
But due to the measures taken by the present government, Gadkari claimed there is not a single stalled road project now. Ventures worth over Rs 50,000 crore have been "terminated" since then.
Gadkari, who handles key infrastructure-related portfolios, said there is no problem with the road sector at present and money is not an issue anymore.
The minister, who had earlier this week blamed the bureaucracy and judicial interventions for laxity in progress on infrastructure projects, said "the system not running fast is the problem" now.
Stressing that infrastructure development is a top priority for the Modi government, Gadkari said, "Making it (the system) run is my job."
It can be noted that after identifying the problem assets, the banking system has begun a process of resolution, led by the RBI-mandated insolvency proceedings for 12 large defaulters who constitute a fourth of the system's dud assets of over Rs 8 trillion.
This list of 12 companies includes infra companies like Jaypee Infra, Lanco Infratech, Jyoti Structures and Era Infra, among others. Other pain sectors which feature prominently are steel, power and textiles.According to some reports, the RBI is at present working on the next list of up to 488 accounts which will be resolved with priority.