Technoglitch
Core Member
India needs to address the stress emanating from leveraged corporate balance sheets and asset quality woes of state-run banks to sustain the recovery process, even as the country is best placed among emerging markets, IMF’s financial counselor Jose Vinals said on Thursday.
“Vulnerabilities in corporate financial positions and public bank asset quality pose risks to the economic recovery and to financial stability if left unaddressed,” Vinals, who looks after the financial stability aspect at the International Monetary Fund (IMF), said during a talk at the Reserve Bank of India.
“To sustain the robust growth in the future and to keep inflation under control and in continuing to keep a lever on fiscal consolidation, it is very important that priority is given to clean-up public sector bank balance sheets and to corporate debt overhang,” he said during the talk at the bank’s headquarters in presence of Governor Raghuram Rajan.
Other aspects, which can help prop-up the recovery are actions from the government on the supply side front, and reforms in the power and mining sectors, he said.
He singled out the country as being the best placed among emerging markets, but underlined that it has problems of its own which need to be dealt with.
“A country like India faces its own idiosyncratic challenges due to existing weaknesses in corporate and banking balance sheets,” he reiterated and acknowledged that work is being done by authorities on this aspect.
India best among EMs; health of PSBs, corporates a worry: IMF | The Financial Express
“Vulnerabilities in corporate financial positions and public bank asset quality pose risks to the economic recovery and to financial stability if left unaddressed,” Vinals, who looks after the financial stability aspect at the International Monetary Fund (IMF), said during a talk at the Reserve Bank of India.
“To sustain the robust growth in the future and to keep inflation under control and in continuing to keep a lever on fiscal consolidation, it is very important that priority is given to clean-up public sector bank balance sheets and to corporate debt overhang,” he said during the talk at the bank’s headquarters in presence of Governor Raghuram Rajan.
Other aspects, which can help prop-up the recovery are actions from the government on the supply side front, and reforms in the power and mining sectors, he said.
He singled out the country as being the best placed among emerging markets, but underlined that it has problems of its own which need to be dealt with.
“A country like India faces its own idiosyncratic challenges due to existing weaknesses in corporate and banking balance sheets,” he reiterated and acknowledged that work is being done by authorities on this aspect.
India best among EMs; health of PSBs, corporates a worry: IMF | The Financial Express
