New Delhi: In an attempt to give a push to economic activity across the country, the Union Cabinet on Tuesday approved a Rs 2.11-lakh crore recapitalisation programme of public sector banks to increase their lending capacity and gave its nod to a major road- building project, Bharatmala Pariyojana, involving an investment of Rs 5.35 lakh crore to build 34,800 km of roads and highways.
Overall, the government is launching an umbrella road-building programme involving a capital expenditure of Rs 6.92 lakh crore to build 83,677 km of highways in the next five years, that also includes Bharatmala Pariyojana.
After GDP growth dipped to 5.7 per cent in the first quarter of the current financial year, there was a need felt in government circles that some steps were urgently needed to push economic growth. A series of meetings were held within the government, involving the PMO, to finalise measures which could help growth.
The government is also under attack from the Opposition, which has alleged that it has mishandled the economy through the hasty rollout of the GST and demonetisation of high-value currency notes.
Several international agencies like the IMF and Asian Development Bank too have downgraded their GDP forecast for India for 2017-18.
Finance minister Arun Jaitley said that though after demonetisation banks had resources, they could not lend due to the lack of capital adequacy caused by the huge non-performing assets on their balance sheets....