Indian economy in transition phase, growth to come back: SBI Chairman

Indian ecomy is in a transition phase largely owing to important reforms undertaken in last few years, a top Indian banker has said exuding confidence that country's growth rate will be back on track.

"Growth can come back. Because of a lot of (reforms), ecomy is in transition. We h GST (goods and services tax). We h IBC (insolvency and bankruptcy code). All se reforms have been implemented in last three years. And as a result, we are in a transition period. A lot of cleanups has happened in corporate sector, SBI Chairman Rajnish Kumar told PTI in an interview.

Kumar, 61, was in Washington last week as part of Indian delegation led by Union Finance Minister Nirmala Sitharaman to attend annual meetings of World Bank and International Monetary Fund."When re is a transition, I think, some disruption always happens," he said.

Kumar furr said in terms of development, India is still t in "developed" category. Besides, per capita income is still low. re is huge scope for growth in India, and demographics are also t against India. Unlike many or developed countries where y are facing challenges on account of demographics, India does t have that kind of challenge at least for time being, he said."And that is where growth can come back," top Indian banker said.

So, in my view, we are seeing bottom as far as ecomic growth is concerned. w it will go up... because sector by sector, if we look at agriculture I'm finding this year's position is better even in terms of credit, manufacturing is slow and private sector investment in infrastructure is slow, he said. Observing that Modi government over past few years has brought banking to doorsteps of every household, Kumar said activation of se accounts have reached almost 90 percent. Besides, balances of se accounts are w reaching a level where servicing se accounts is t a loss-making proposition for banks, he ted.

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Recapitalisation has happened in a big way 

"Aver balance in se accounts is touching Rs 1,900, about Rs 230 billion in June was balance in savings bank account, he said, ding that re is a benefit to ecomy when one is able to bring such a large population under banking channels.

ting that biggest challenge in banking sector was about functioning of public sector banks, Kumar said recapitalisation has happened in a big way but sectoral issues need to be dressed like power, ro and telecom sectors. "se sectoral issues impact working of banks, particularly in asset quality front," he said.

He furr said that in this government, re is political interference in banking sector. "State Bank of India has been more immune to any pressures because systems are such that it is very difficult for any Chairman, any MD to influence any decision-making process, he said. When asked about cryptocurrency, which has been banned in India, SBI Chairman said that way world is moving towards digitization, at some st, a regulated cryptocurrency would be a better bet than an unregulated one.

Let's see. Because re's a dark side of internet also. re can be a misuse of digital currencies. That is why regulation is must, he said ding that efforts are on how to bring techlogies like blockchain into functioning of banks.

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