New Delhi: Finance minister Arun Jaitley on Monday said that bank credit growth is expected to pick up as economy is gradually moving up. Mr Jaitley said that government will sell stake in some state-owned companies, especially those in metals business, only when market conditions improve.
“The economy is gradually picking up and therefore as demand picks up, certainly that off take (loan growth) itself will also pick up,” said the finance minister after a review meeting with PSU bank chiefs.
The issue of passing on the benefit of rate cut was also discussed, with the PSU banks noting that their base lending rates had been reduced consequent upon the rate reduction announced by the Reserve Bank.
On dis-investment, Mr Jaitley said, “I have already said (that) there are few stocks, especially metal stocks, which are down globally. Therefore, in such circumstances, it would not be appropriate to sells such stocks in the market. We will sell such stocks after market condition improves.”
The government has budgeted to raise Rs 69,500 crore through disinvestment in 2015-16. With eight months of the current fiscal about to be over, the government has been able to sell stake only in four companies — PFC, REC, Dredging Corp and IOC — to net Rs 12,600 crore.
He said that the government is considering “proactive steps” to improve the health of steel and aluminium sectors which are reeling under the impact of decline in global prices.
“Several suggestion have been offered by the bankers in relation to both steel and aluminium. Some of them have been examined by the Department of Revenue,” he said.
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