Focus In 2014-15 Was On Financial Sector Reforms: Economic Survey
On the increase in the non-performing assets (NPA), the economic survey notes that as on June 2014, five sub-sectors - infrastructure, textiles, iron and steel, mining and aviation hold 54% of the total stressed advances of government owned banks. According to the Survey, the Reserve Bank of India (RBI) issued guidelines for the banks to act fast as soon as a sign of stress is noticed in loan accounts.
The RBI also tightened norms to asset reconstruction companies, increasing the minimum investment in security receipts to 15 percent from five percent.
The central bank also issued guidelines to bring flexibility in project loans to infrastructure and core industry projects.
According to the survey, 2014-15 also saw a decline in the growth of bank credit due to high accretion of NRI deposits and also due to low deposit mobilization.
The survey noted that the equity markets continued to do well during 2014-15 with the benchmark indices, BSE Sensex and Nifty showed a general upward trend in the current year with growth rates of 29.9 percent and 31.4 percent year on year.
The survey lists improvement in corporate governance norms and establishment of a foreign portfolio investor for better functioning of both primary and secondary markets.
Read More: India Inc Expects Tax Reforms, Financial Balance From Budget 2015
