SME Times News Bureau | 12 Nov, 2018
Finance Minister Arun Jaitley on Sunday emphasised the role
of banks in lending to the micro, small and medium enterprise (MSME) sector.
Speaking via video-conference at an event here to mark the
100th anniversary of the Union Bank of India, Jaitley said that it is only
through the banking sector that lending can be provided to sectors such as the
MSMEs and NBFCs.
The Finance Minister said that the banking system needed to
be strengthened to meet the market's liquidity requirements and drive economic
The central government has in the last four years pumped Rs 70,000 crore and Rs
2.12 lakh crore into state-run banks in separate tranches to help the bad
debt-laden lenders, he said.
These steps to infuse capital have improved the banks' lending capacity, on
which the future of economic growth depends, he said.
Jaitley added that policies have to be targeted towards improving the lending
capacity of the banking system and to improve liquidity available for the
Terming the Goods and Services Tax as a 'monumental' reform,
Jaitley said the implementation of the indirect tax had impacted economic
growth for only two quarters.
He contended that the economy rebounded after a decline in
the first two quarters after the GST came into force.
His comments came a day after reports cited former Reserve bank of India
Governor Raghuram Rajan as saying that GST and demonetisation slowed India's
economic growth at a time when other economies were expanding fast.
It's true that for two quarters after GST, growth got
impacted but in the subsequent quarters, the economy expanded by 7 per cent,
7.7 per cent and 8.2 per cent, he said.