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Sinha backs orderly resolution of genuine cases of NPAs, wilful defaulters to face full force of law

14 Mar 2016 Evaluate

Minister of State for Finance Jayant Sinha has said that in order to resolve non-performing assets (NPAs) of companies that are genuinely not able to repay their loans due to global slowdown or because of policy failures of the previous government, India needs appropriate policy intervention as well as process. He said that the country should have appropriate resolution process as well as appropriate policy interventions to ensure that NPAs due to such kinds of reasons go through an orderly workout and resolution process.

Reiterating that the government is committed to punish the wilful defaulters, Sinha said that there are some people who are wilful defaulters, who have engaged in illegal activity. As far as they are concerned, the full force of the law is being applied and all the investigative agencies are working to ensure that willful defaulters are brought to justice. The minister said that wilful defaulters and corporates which are unable to repay loans due to hits to their businesses owing to global slowdown should not be co-mingled and confuse one with the other.

Sinha further said that the government also has to see that people facing business challenges do not have to go through such problems again. Sinha said “We have to deal with structural issues, which is where the bankruptcy code becomes important so that we avoid these kinds of problems in the future as well”. He said that there isn't anything that is illegal or criminal done, those are classic business failures that happen because of the wrong business and financial strategies or external factors that made the project or business unviable.


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