Industry body Assocham wants the government and the Reserve Bank of India (RBI) to take a pragmatic approach while resolving the issue of non-performing assets of the banks.
“The terms of different schemes for resolution of the NPAs should be flexible and liberal enough to be accommodative rather than being rigid,” Assocham president Sandeep Jajodia said here on Thursday. Secretary general D.S. Rawat added that the time frame for an account getting classified under the NPA should be extended from the existing 90 days to 180 days.
The moment an account becomes an NPA, the avenues for working capital get chocked thus hastening the curtains on the enterprise. The complex issue of NPA, Mr. Jajodia said, could be resolved only when a realistic assessment of the state of the stressed or non-performing assets is done and commercial decisions taken by the banks without fear of being haunted.
The Assocham would be submitting a representation in this regard to the government soon.
In Hyderabad at a managing committee meeting, the Assocham leaders also underscored the need for a reduction in the interest rates in the backdrop of the inflation at the retail level staying below 3%.
On the Goods and Services Tax (GST), Mr. Rawat said Assocham welcomed it, but wanted the tax authorities to give time to the assessees to understand and comply under the new regime.
The industry body, he added, also wanted the government to focus on measures that help in creating more jobs besides boosting the growth of small and medium enterprises and farmers. On the alleged layoffs in the IT industry, he said an estimated four lakh people have been affected in the last 4–5 months. Increasing automation, he added, was also resulting in loss of jobs in steel, textile and pharmaceutical industries.
The ease of doing business initiatives of the Telangana and A.P. governments have been hailed by the industry body. “Both the Centre and other State governments should replicate the TS and A.P.’s EoDB model to lure potential investors,” Mr. Jajodia said.
