Bad loans: India ranks 5th on list of countries with highest levels of NPA

New Delhi: Even as the government is all set to infuse fresh capital in state-owned lenders in the new year as it looks to lift banks out of NPA crisis and revive lending growth from a 25-year low, a new report has stated that India is behind only four countries when it comes to bad loans.

A report by CARE Ratings stated that India ranks fifth on a list of countries with the highest levels of NPAs among BRICS countries. India’s NPA ratio is at 9.85 percent.

Countries that have ranked higher than India on the list are Greece (36.37 percent NPA ratio), Italy (16.35 percent NPA ratio), Portugal (15.52 percent NPA ratio ), and Ireland (11.85 percent NPA ratio).

Spain is the only PIIGS country ranked lower than India on the list.

EU nations –Portugal, Italy, Ireland, Greece and Spain — are commonly referred to as PIIGS.

The government in October announced infusion of an unprecedented Rs 2.11 lakh crore capital over two years in public sector banks that are reeling under high non-performing assets (NPAs). Their NPAs have increased more than two-and-a- half times to Rs 7.33 lakh crore as of June 2017, from Rs 2.75 lakh crore in March 2015.

Of the Rs 2.11 lakh crore package, Rs 1.35 lakh crore would be infused through recapitalisation bonds.

The Finance Ministry would soon announce contours of the recapitalisation bonds and the amount to be front loaded during the current fiscal.