RBI Says Infusing Funds Into India Lenders Won't Solve Debt Mess
- Banks would be willing to lend but there is no demand: Acharya
- Companies need to take measures to reduce stressed debt
Pedestrians walk past the Reserve Bank of India headquarters in Mumbai.
Photographer: Dhiraj Singh/BloombergThis article is for subscribers only.
Indian central bank Deputy Governor Viral Acharya said injecting new funds into lenders won’t resolve the nation’s stressed asset plight until companies take steps to reduce debt.
The Reserve Bank of India is seeking to strengthen the banking system through measures including merging weaker banks and pushing to privatize some state-run lenders as it ramps up efforts to resolve the world’s highest stressed-asset ratios. Banks would be happy to lend but there is no demand from corporates as they are heavily indebted, he said in a speech in Kolkata on Friday.