Demonetisation & thrust on digital transactions aimed at transforming India into a tax-compliant society: Arjun Ram Meghwal
Effective appraisal of loans imperative to prevent them from becoming NPAs
The demonetisation exercise together with promotion of digital transactions are aimed at transforming India into a tax compliant society, union minister of state for finance and corporate affairs, Mr Arjun Ram Meghwal said at an ASSOCHAM event held in Mumbai today.
“Growing digital transactions will widen the tax base thereby reducing the non-compliance or instances of tax theft in the country,” said Mr Meghwal while addressing 12th ASSOCHAM Banking Summit.
He said that banks in India should carry out proper appraisal and due diligence process prior to loan disbursement to avoid piling up of non-performing assets (NPAs),
“Banks should aim to reduce NPA levels below 10 per cent and try to maintain it effectively by bringing it further down,” said Mr Meghwal.
“Besides the banks in India should highlight the work carried out by them in the social sector as part of their corporate social responsibility (CSR) related initiatives,” he added.
Mr Meghwal further said that introduction of GST (goods and services tax) and thrust on digital transactions are two major economic reforms that will further increase the work load on banks.
“You should prepare yourself as many new firms and many more fresh registrations will be made during the upcoming GST regime, so you should be able to extend proper guidance, co-ordination and finance to them,” he said while addressing bankers at the ASSOCHAM seminar.
He also said that it is imperative to increase the share of agriculture sector in India’s gross domestic product (GDP) up to 40 per cent from the current level of 17 per cent by exploiting the ample of scope available in dairy, fisheries and other such allied activities.
He said that government had increased agriculture credit target to Rs 10 lakh crore for 2017-18 fiscal and the same could be further hiked in the budget for 2018-19 fiscal if banks are able to reach the intended sectors/groups that have largely been neglected.
“Reaching the unreached and funding the unfunded sectors should be the main focus of the banks,” said Mr Meghwal.
The union minister of state also said that with an uncertain economic scenario prevailing in most parts of the world be it the European Union, the US or be it the Organization of the Petroleum Exporting Countries (OPEC), the 21st Century belongs to Asian majors – China, India, Japan and Russia.
“For India to emerge as a superpower in the 21st Century, banks in India have to play a major role,” he added.
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