Law can’t be ‘blind’, shouldn’t treat every default as NPA on 90th day: Piyush Goyal to RBI
Team Udayavani, Feb 9, 2019, 7:03 AM IST
Mumbai: Union finance minister Piyush Goyal on Friday said that if a borrower does not get its dues from entities like discoms, it should not lead banks to classify that borrower automatically as defaulter.
The comments come a day after the Reserve Bank made it clear that it is not having a relook at a contentious circular about recognising of bad assets, issued on February 12 last year.
“Law cannot be a blind, wherein in 90 days arithmetically it becomes an NPA (Non performing asset). We will also discuss this and we hope to resolve it quickly,” Goyal said, speaking to industry representatives in a post-budget interaction at the BSE here.
He cited the case of a power producer to which a distribution company owed money, stating that just because the discom did not pay up, the power producer does not become a defaulter.
It can be noted that sections of the industry have moved the Supreme Court for special treatment to the power sector when it comes to classification of NPAs.
“I think it is worth discussing with the Reserve Bank that if a payment is overdue and discom is not paying its bill, then we will have to think about NCLT and NPA,” he said.
Exhorting the industry to report any such instances, Goyal said the Government could ensure capital markets watchdog Sebi withdraws a proposal to disclose every default by listed companies, and hinted that similar measures will be taken up with RBI as well.
Goyal also said that there is a need for specialised development finance institutions like IDBI, IFCI and ICICI, saying that asset liability mismatch results in difficulties for the banking system to support the infrastructure sector.
He said the Government is also trying to get the remaining eight banks out of the restrictive prompt corrective action (PCA) framework.
Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.
Top News
Related Articles More
SC refuses to examine plea to appoint ‘yoga mitra’ instructors in schools
Maha Vikas Aghadi a vehicle sans wheels and brakes: PM Modi
LDF lodges complaint with EC, seeks probe into distribution of food kits in Wayanad
SC dismisses PIL seeking CBI probe into Tirupati laddus row
Salman Khan gets another threat; message sent to Mumbai traffic police helpline
MUST WATCH
Latest Additions
World Bunts Summit to be held in Mumbai on December 7
SC refuses to examine plea to appoint ‘yoga mitra’ instructors in schools
Maha Vikas Aghadi a vehicle sans wheels and brakes: PM Modi
LDF lodges complaint with EC, seeks probe into distribution of food kits in Wayanad
SC dismisses PIL seeking CBI probe into Tirupati laddus row
Thanks for visiting Udayavani
You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.