Monday, November 28th, 2022

The Indian government is planning to set up digital-only banks.

The Indian government is planning to set up digital-only banks. Non-banking financial companies (NBFCs) to ensure that business continuity in the lending system is not affected even in exceptional times. In her first public appearance before the Atlantic Council think tank; Nirmala Sitharaman told a select Washington audience that the government had made efforts to achieve macroeconomic stability. The efforts made by recapitalizing banks and increasing foreign exchange reserves. 

The Reserve Bank of India has also been very nimble about setting up ‘digital only’ NBFCs.  

The Minister said bad loans and provisioning were taxing. Government has to keep infusing money into banks. It has amalgamated several of them. The Reserve Bank of India has also been very nimble about setting up ‘digital only’ NBFCs. Now the government is in the process of setting up digital banks as well, not one but 75 of them this year.  Sitharaman is in Washington DC to attend the annual spring meeting of the International Monetary Fund and the World Bank. Exuding confidence about India posting robust economic growth this decade, she said recovery from the pandemic was distinct. So, as you look at India, given the pandemic and the recovery from it, and also where India stands today. We see the decade before us…2030 as a very robust decade where India would definitely be one of the fastest-growing economies, The Finance Minister said.  

At the same time, she said the task ahead was challenging in view of rising commodity prices. Especially those of crude oil and natural gas, geopolitical uncertainties, and the global growth slowdown. On inflation, she said India had breached the upper threshold of 6 percent but not so bad. Sitharaman said, along with the response to the pandemic, the government had taken reform measures. Which includes those on the supply side. She told the audience the government’s focus was on pushing capital expenditure without losing sight of its moral obligation toward the underprivileged. The minister had announced in the Budget an increase in capital expenditure by a sharp 35.4 percent to a record Rs 7.50 trillion. From Rs 5.54 trillion in the last financial year 

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