FM Sitharaman to hold review meet with heads of banks, NBFCs over COVID-19 related stress

Nirmala Sitharaman, the Union Finance & Corporate Affairs Minister, is scheduled to hold a review on Thursday with the top management of Scheduled Commercial Banks and Non-Banking Financial Companies (NBFCs), over the implementation of the resolution framework for COVID-19 related stress in bank loans.

The review will focus on enabling businesses and households to avail the revival framework on the basis of viability, necessary steps like finalising bank policies and identifying borrowers and discussing issues that require addressing for smooth and speedy implementation. According to reports, the review meet will also discuss the progress of various schemes announced under the Aatmanirbhar Bharat Abhiyaan of Rs 20.97 lakh crore.

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GDP decline due to COVID-19

The finance minister had faced criticisms over the steep decline in GDP numbers due to the impact of COVID-19 pandemic on the economy. The provisional estimates of GDP were released by the government on Monday for the quarter April-June 2020 (Q1 FY21). The data revealed that the Indian economy had contracted by 23.9% in the April to June quarter. This marked the first contraction in more than 40 years as COVID-19 pandemic compressed consumer demand and private investments, the government data revealed. The National Statistical Office (NSO) said gross value added (GVA) came in at minus 22.8%.

Last week the finance minister had to face criticisms after she said the economy has been hit by the COVID-19 pandemic, which is an 'Act of God', and it will see a contraction in the current fiscal.  As per the Centre's calculations, states will be facing a shortfall of Rs 2.35 lakh crore in GST revenues in 2020-21.

"This year we are facing an extraordinary situation that even below 10 per cent approximate estimation you are facing an 'Act of God' which might even result in a contraction of the economy...," Sitharaman said.

(Image credit: PTI)

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