In the current financial year up to July 31, 2023, the government has successfully raised a substantial amount of Rs 5.77 trillion by issuing dated securities, as stated by Finance Minister Nirmala Sitharaman on Tuesday.
Within the same period, a net amount of Rs 4.18 trillion has been raised through this financial instrument. Government borrowing involves various sources, such as dated securities, treasury bills, external loans, and state provident funds.
NEW DELHI: For the fiscal year 2023-24, the central government has planned to secure net debt resources amounting to Rs 17.99 trillion from various sources, primarily to fund its fiscal deficit, as mentioned in the finance minister's written reply to the Rajya Sabha.
"The proposed amount constitutes approximately 40 per cent of the total net size of the Union Budget 2023-24, which stands at Rs 45.03 trillion," she further added.
In the upcoming fiscal year (FY24), the government aims for a gross market borrowing of Rs 15.4 trillion from dated securities, which surpasses the total borrowing of Rs 14.21 trillion in FY23.
It is important to note that entities like the National Highway Authority of India borrow based on their own balance sheets, according to the finance minister.
Regarding another matter, Sitharaman disclosed that banks and financial institutions are obligated to submit lists of wilful defaulters with outstanding amounts of Rs 25 lakh and above to credit information companies (CICs). Moreover, CICs have been advised to make information related to suit filed accounts of wilful defaulters available on their respective websites, following RBI guidelines. Consequently, lists of suit-filed wilful defaulters with outstanding amounts of Rs 25 lakh and above are accessible in the public domain through the websites of Credit Information Companies (CICs).
In accordance with RBI's instructions, wilful defaulters are barred from receiving any additional facilities from banks or financial institutions, and their units are debarred from institutional finance for five years if they plan to initiate new ventures. Additionally, wilful defaulters and companies with wilful defaulters as promoters/directors are prohibited from accessing capital markets to raise funds. Sitharaman also mentioned that the Insolvency and Bankruptcy Code 2016 restricts wilful defaulters from participating in the insolvency resolution process.
Furthermore, the gross non-performing assets (NPAs) of scheduled commercial banks (SCBs) have demonstrated a downward trend over the last three financial years. The gross NPA ratio decreased from 7.33 per cent (Rs 8.35 lakh crore) as of March 31, 2021, to 5.82 per cent (Rs 7.42 lakh crore) as of March 31, 2022, and further to 3.87 per cent (Rs 5.71 lakh crore) as of March 31, 2023, said the finance minister.
Responding to queries about fraud cases, Sitharaman conveyed that the RBI does not maintain data regarding the amount written off in accounts declared as fraud. However, based on RBI data regarding fraud occurrences, the amount involved in fraud for Scheduled Commercial Banks (SCBs) declined from Rs 12,819.57 crore in the financial year (FY) 2020-21 to Rs 6,979.72 crore in FY 2021-22, and further to Rs 1,650.27 crore in FY 2022-23, for amounts of Rs 1 lakh and above.
As part of the actions taken against fraud cases, banks are required to promptly lodge complaints with law enforcement agencies upon detecting fraud. The Directorate of Enforcement (ED) reported that as of July 28, 2023, they are investigating 848 bank fraud cases involving both public and private sector banks under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA). Necessary actions have been taken in accordance with the PMLA provisions, leading to the attachment of proceeds of crime worth approximately Rs 62,179 crore. Furthermore, 112 individuals have been arrested in these cases, and 195 prosecution complaints have been filed before the PMLA special court. Additionally, assets amounting to Rs 15,113.02 crore have been confiscated and restituted to the PSBs in connection with these cases.