New Delhi, August 17: Finance Minister Nirmala Sitharaman announced on Monday that a high-level committee will soon be formed to determine the role of the banking sector in realizing the vision of ‘Developed India 2047.’
While addressing the opening ceremony of a two-day conference for heads of public sector banks and financial institutions in the national capital, Sitharaman stated, “Once the committee submits its report, we will act swiftly on its recommendations.”
During her presentation of the 2026-27 central budget, the Finance Minister proposed the establishment of this committee to review how the banking sector can align with India’s development goals.
Sitharaman emphasized, “This committee will consider the role of banks in achieving the ‘Developed India’ objective. The target for 2047 is not far off. We are currently in 2026, meaning we have less than 20 years left.”
She also highlighted the significant improvements in asset quality within the banking sector, stating that these enhancements provide an excellent opportunity to advance reforms in the industry.
The Finance Minister urged public sector banks to leverage their strong balance sheets to support the next phase of economic growth and prepare for banking reforms aimed at creating a financial system aligned with the government’s ‘Developed India 2047’ vision.
She noted that the banking sector is entering this next phase from a position of strength, as non-performing assets (NPAs) are at their lowest levels.
Sitharaman explained that with NPAs at record lows, there has never been a better opportunity for banks to push forward with reforms.
She mentioned that suggestions from banking leaders could provide crucial input for the committee and assist the government in acting quickly on their recommendations.
Furthermore, the Finance Minister stressed that banks should pay special attention to the country’s youth, as 29 percent of Indians fall within the 15-29 age group. She urged banks to enhance access to financial services for young people, including education loans, entrepreneurship financing, and investment products.
Sitharaman also called for practical and actionable ideas to meet the new financing needs of the banking sector. She stated that after the committee’s recommendations are released, the sector should be prepared to “accelerate the Indian economy.”
Meanwhile, Sanjay Lohiya from the Department of Financial Services reported that public sector banks have seen remarkable improvements in asset quality. The gross NPAs have decreased from a high of 14.6 percent in March 2018 to a record low of 1.93 percent in March 2026, while net NPAs have dropped from 8 percent to 2.39 percent during the same period.
–
ABs
Leave a Comment