NPAs gone, banks ready to lend: Niti Vice Chair

By Nirbhay Kumar New Delhi, March 3 : On the back of measures taken by the government over the last two years, the Indian economy will see steady growth going forward and the era of ups and down is now behind us, said Niti Aayog Vice Chairman Rajiv Kumar. He said that agriculture sector has recorded 3 per cent plus growth even during pandemic times and there are all signs of manufacturing growth picking pace on growing consumption demand. “..Manufacturing capacity (utilisation) which is around 60 per cent will get fully utilised. Now there are all signs, you talk to anyone (in the industry), their balance sheets are much better, NPAs are gone, banks are ready to lend,” Kumar told in an exclusive interview. On services sector, he said that software services exports have been on the rise but tourism sector would take time. “Overall, I see going forward rising steady growth trend. Also because of all the measures that have been taken in the last two years, the era of ups and downs is now behind us,” Niti Vice Chairman said. He dismissed the claims of many economists and policy watchers that government did not take enough measures to boost demand by providing cash support to people and said that cash was directly transferred into the accounts of farmers under Pradhan Mantri Kisan Samman Nidhi (PM-KISAN). “I think Rs 72,000 crore have been passed on in direct transfers under PM-KISAN. Those who make the suggestion or make criticism never talk about that. There are these 11-12 crore households out of total number of households of 25 crore in our country,” Kumar said. He noted that those who were really deprived got free ration under Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) . “Second, those (who) were really deprived got transfers not in cash income but in food income. So, whoever got that at least saved that much and therefore had purchasing power, extra money to spend on. This is also not taken care of,” he said. On covering other low and medium income group people especially in tourism, hospitality and informal sectors, the Niti Vice Chairman said that identifying and targeting them was a challenge. He also pointed out that it has been noticed that people tend to deposit the cash income they get during such times instead of spending and rising deposits in Jan Dhan accounts over the last two years was evidence of it. The government data shows as on March 25, 2020 (pre-covid lockdown), the total number of Jan Dhan accounts were 38.33 crore with a deposit balance of Rs 1.18 lakh crore. The total number of accounts rose to 43.85 crore in November 2021 with a deposit balance of Rs 1.48 lakh crore. “Why they have risen? Such consumption transfers create a one-off demand effect because consumption has no multiplier. But if you spend the money in investment and construction and other things it has multiplier effect. It creates successive rounds of income generation which is why it is not right to say that the government didn’t take care of the demand side. It chose much more certain way of creating demand by additional investment, therefore generating employment, income and consumption,” Niti Vice Chairman said. NK ING

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