Government banks bag Rs. 15,183cr after ED action under PMLA
The Enforcement Directorate (ED) has seized assets valued at Rs. 15,186.64 crore under the Prevention of Money Laundering Act (PMLA). The majority of these assets have been returned to public sector banks, according to Union Finance Minister Nirmala Sitharaman. She mentioned that specific actions are being taken against defaulters through various legal provisions, resulting in "huge monies" being returned to the banks.
Legal suits and recoveries made
Sitharaman informed that as of March 31, 2023, legal suits were filed for recovery against 13,978 loan accounts. Meanwhile, action under the SARFAESI Act was initiated in 11,483 cases, FIRs were filed in 5,674 cases, and a total of Rs. 33,801 crore was recovered. "As of December 1, 2023, assets amounting to Rs. 15,186.64 crores under the PMLA have been confiscated by the ED out of which Rs. 15,183.77 crores have been restituted to the Public Sector Banks," she stated.
Phone banking and UPA rule
Discussing "phone banking," Sitharaman explained it as a method through which "political interference (during UPA rule) spoilt all our banks and drove them to a loss-making situation." She added that during this period, calls were made to grant loans to unworthy individuals. "The burden fell on us to sort the banks out with reforms. Prime Minister Narendra Modi sat with all of us. We spent a lot of time understanding where the problem was and worked together with the RBI."
Decline in NPAs and economic growth
Over the last two financial years, the number of non-performing asset (NPA) accounts in commercial banks has decreased from 2.19 crore to 2.06 crore, a 6.2% decline. Likewise, the aggregate outstanding of such accounts (gross NPAs) has dropped from Rs. 7.41 lakh crore to Rs. 5.72 lakh crore during the same period (22.9% decline). Due to the Centre's measures, Sitharaman stated that the Indian economy is the world's fastest-growing, with a 7.6% GDP growth rate in the last quarter.
