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

Drugs worth Rs 6 crore seized in Bengaluru, five arrested

Siddaramaiah urges Nirmala Sitharaman to address NABARD’s loan cuts to farmers

Karnataka HC denies anticipatory bail to Prajwal Revanna in sexual harassment case

Delhi court stays defamation case against CM Atishi

Awards don’t create value for independent films in India: Manoj Bajpayee

Public Alert: Cyber fraudsters impersonating traffic police to demand fines

UP: 25 people booked for attacking civic officials for encroachment removal

Related Articles More

Air pollution: SC flags Delhi govt’s failure to implement GRAP-4 curbs on entry of trucks

Baba Siddique murder: Man held from Akola, 26th arrest in case

SC notice to Gyanvapi mosque committee on plea for ASI survey of ‘shivling’ area

Delhi court stays defamation case against CM Atishi

Sambhal Jama Masjid row: Friday prayers held peacefully amid tight security

MUST WATCH

Christmas Cake Fruit Mixing

DK Shivakumar

Rose Cultivation

Geethotsava

Naxal Operation


Latest Additions

Air pollution: SC flags Delhi govt’s failure to implement GRAP-4 curbs on entry of trucks

Drugs worth Rs 6 crore seized in Bengaluru, five arrested

Siddaramaiah urges Nirmala Sitharaman to address NABARD’s loan cuts to farmers

Satwik-Chirag enter semifinals, Lakshya loses to Antonsen in China Masters

BJP stages protest against Congress govt in Karnataka over Waqf properties row

Thanks for visiting Udayavani

You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.