Government has stated that it will not access World Bank funds to recapitalise state-run banks as it has enough money for this purpose.
“Absolutely not,” was Financial Services Secretary Rajiv Takru's terse response when reporters asked him whether the Government will seek a World Bank loan to infuse capital into the 26 public sector banks (PSBs). “We have already given the banks Rs 14,000 crore and will give more. We don't want any money from the World Bank to give to the banks as we have made enough provisions in the Budget for this,” he told reporters on the margins of a Ficci event .
Earlier this week, the Finance Ministry had announced a Rs 14,000-crore capital infusion for banks. It had also said under a special scheme approved by the Ministry, PSBs were asked to lend at lower rates to a slew of consumer products. Under the capital infusion programme, SBI will get Rs 2,000 crore, while IDBI Bank and Central Bank of India will get Rs 1,800 crore each.