Govt to handhold stressed sectors to help them brave gloom: FM

Will work out a strategy to assist industry segments reeling under the impact of economic slowdown: Chidambaram

PTI | November 15, 2012



Open to handholding the stressed sectors, finance minister P Chidambaram on Thursday said government will work out a strategy to assist industry segments reeling under the impact of economic slowdown.

"If the economy improves and growth improves, the sectors (which are not doing well) will recover. But in the meanwhile we will have to do some handholding and try to help these sectors recover", he said while addressing a press conference after meeting the heads of public sector banks here.

The government will have to look at rising Non-Performing Assets (NPAs) sector wise and find ways and means to help them, he said, adding the "NPA is reflection of the slowdown in the economy".

The NPAs of the public sector banking group has increased by 0.98 per cent in the one-year period ending September 2012 mainly on account of the stress being faced in sectors like infrastructure, steel, construction, textile, food process and telecom infrastructure, the Minister said.

On the positive side, Chidambaram said housing and automobile sectors have been doing well on back of decline in EMIs.

The Minister said government would soon finalise capital infusion for the PSU banks and the beneficiaries would include Indian Overseas Bank, Central Bank of India and Bank of Maharashtra. The government had proposed to inject Rs 15,000 crore of capital in the PSU banks.

Referring to the issue of new banking licences, Chidambaram said he had written to the Reserve Bank to initiate the process of issuing guidelines and start accepting the licences pending approval of the Banking Regulation Amendment Act by Parliament. .

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