Govt working with RBI on loan restructuring for industries: Sitharaman

Finance Minister Nirmala Sitharaman.

New Delhi (NVI): The government is working with the Reserve Bank of India (RBI) on restructuring of loans for industries that are impacted due to the coronavirus pandemic, Finance Minister Nirmala Sitharaman said today.

Addressing the Federation of Indian Chambers of Commerce and Industry (FICCI) interaction, Sitharaman said, “The
focus is on restructuring, the finance ministry actively engaged with RBI on this. In principle, the idea that there may be a restructuring required, is well taken.”

Speaking about the steps being taken to deal with the current crisis situation, she said that every step which is being announced and taken, is taken after exhaustive consultations with the stakeholders and industry experts.

“The government to make sure that no step is going to be a failure because we did not make necessary collateral changes. We have taken these steps to ensure that the impact is felt on the ground,” she added.

The hospitality sector remains one of the worst-hit sectors due to the lockdown induced by the coronavirus outbreak in the country.

In addition to this, Sitharaman emphasised on reciprocity of trading arrangements with the countries with which India have opened up markets. “Reciprocity is a very critical point in our trade negotiations,” she added

The finance minister also assured that the decision on reducing GST rates on the healthcare and other products will be taken by the GST Council.

Sitharaman further said banks cannot refuse credit to MSMEs covered under emergency credit facility. “If refused, such instances must be reported. I will look into it,” she said.

She also stated that the ministry is working on setting up of development finance institution (DFI) for infrastructure financing. “The work is going on the DFI. What shape it will take, we will know shortly,” she added.

However, the finance ministry had started work on setting up of new DFI government backed specialized institution to offer funds to borrowers, which is likely to be finalized and set up in the next six months.

-RJV