Non-Performing Assets (NPA) is a major concern for industries and infra-projects. Hence, private investment in these sectors is tumbling.
Coercive actions will neither save the banks, nor the industries. Instead, there will be irrevocable damage to industrial assets disrupting the Indian economy.
“Prudent solution exists in modifying NPA norms, suited to Indian conditions, instead of following developed countries blindly. At best, we can look at the norms adopted by those countries during their developing phases”, said Dr Subhasish Das, Group President, Hira Group and President Himadri Chemicals. The group has interest in steel, ferroalloys, pellet, power, mining and specialist chemicals.
The plants are based in States like Chhattisgarh, Odisha, Andhra Pradesh, Gujrat, MP and West Bengal.
Dr Das said that priority must be given to lending for productive and infrastructure assets instead of consumption spending. More so, interest rate for productive sectors must be lower or at par with consumption lending, whether private or public.
Burden of cross subsidy on productive sector due to differential interest will make India non-competitive. Inadequate raw materials, global slowdown, infrastructure deficit, high cost of energy and logistics have aggravated their problems. High interest rates and tight credit policy multiplied their miseries. Several sectors are trapped in regulatory and policy hurdles, said Das.
It is well established that high industrial growth is essential for generating job opportunities and augmenting revenue. Even banks can’t survive on consumption lending.
Das is also very active in National level association like SIMA,PMAI and recently elected as Secretary General of NPAI and is based out of Delhi.
In the event of delay, India will be losing entrepreneurs. Many of them are frustrated and are repenting investing their life time savings in industrial assets.
A firm approach is needed for consistent and hassle free growth and development of the nation, he opined.