Is India’s twin balance sheet problem over?
Finshots Daily
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India's Twin Balance Sheet Woes Continue
Banks resorted to a practice called evergreening which meant that they simply kept extending new loans to the crippled corporate sector. NPA's rose from a mere 4% in 2014 to over 11% by 2018. To get out of this we first needed to clean up the problem. Make sure there was no skeletons in the closet. The government stepped in between F5, 17 and F5, 21. It infused over 3 lakh crore rupees to strengthen PSB's. And it would spur a fresh round of lending. In 2021 we established a separate bank that would deal only in bad debts.
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