Facing criticism over the National Monetisation Pipeline, under which the government plans to raise Rs 6 lakh crore over four years, Finance Minister Nirmala Sitharaman on Wednesday stated that the government was not selling off national assets and that it had already been made clear that there would be no change of ownership of the assets planned to be monetised.
On Tuesday, Congress leader Rahul Gandhi had hit out at the NMP, stating the Narendra Modi government was in the process of selling India’s crown jewels built by previous governments with public money over 70 years.
Sitharaman, who was speaking with reporters in Mumbai on Wednesday, hit back saying the Congress was misleading the people. Citing the example of the Mumbai-Pune Express way, the finance minister said it was the Congress government that had monetised it and floated request for proposal for the New Delhi railway station.
“I wish the opposition questions with some homework done. Who actually monetised the Mumbai-Pune corridor? Is it not the Congress party? Rs 8,000 odd crore was raised by that… New Delhi Railway station? Who called for the RFP on it? Was it not the Congress somewhere between 2008?,” questioned Sitharaman.
“We are not selling-off. There will be a strict handing back,” she stressed further.
Sitharaman who was on a two-day visit to Mumbai, met the heads of the public sector banks earlier in the day. During the meeting, she took stock of the performance of the state-owned lenders as well as how the various packages announced under Atmanirbhar Bharat were being implemented.
The finance minister said that “collectively the public sector banks had done well”. Several PSBs had come out of the RBI’s prompt corrective action framework and were now showing profits. They were also in a position now to raise funds from the market, the minister added.
However, she didn’t give any update on the proposed privatisation of two PSBs.
Department of Financial Services Secretary Debashish Panda pointed that state owned banks have earned a net profit of Rs 30,000 crore, the net non-performing assets have fallen to 3.1 per cent from 9 per cent two years ago, and these improved fundamentals have given investors the confidence in PSBs.
“Banks have gone to the market and raised Rs 69,000 crore, including Rs 10,000 crore of equity capital. Therefore, the capital requirement is being met by the banks themselves. In the first five months of this financial year, more than Rs 12,000 crore in fund raising is already in the process,” said Panda.
In order to boost the credit growth in the economy ravaged by the COVID-19 pandemic, Sitharaman said there will be a credit outreach programme that banks will undertake in every district of the country this year. There was a similar credit outreach programme that banks undertook in 2019 and around Rs 4.94 lakh crore was distributed between October 2019 and March 2021 through this outreach, said Sitharaman.
Meanwhile, the finance ministry has approved an increase in family pension for state-owned bank employees. Also, the employer contribution to National Pension System has been raised from 10 per cent to 14 per cent in case of PSBs, Panda informed.
He also said that “substantive” work had been done in relation to the proposed bad bank. Earlier this week, the Indian Bank Association approached the Reserve Bank seeking a licence for the National Asset Reconstruction Company, which Panda said is expected to come soon.
He further said that assets that are to be transferred to the NARCL had also been identified and the staff had also been put in place. On the asset management company front, the company registration work was in the process, he added.
Meanwhile, a proposal to allow direct listing of securities on overseas platforms “is under consideration of the government,” Revenue Secretary Tarun Bajaj said. Such a move, if allowed, will help Indian entrepreneurs to list on foreign stock exchanges, which are far more bigger and deeper. So far, Indian companies have been able to issue American Depository Receipts (ADRs) or Global Depository Receipts (GDRs) on foreign markets.
“To make it a success, there would be some requirement of amendments in some legislation to ensure there is a smooth trading of these securities outside the territory of India. We are in discussion with players who are asking for this,” Bajaj told reporters.