Union Finance Minister holds Pre-Budget Consultation meeting with the representatives of Banking and Financial Institutions
June, 10th 2014
PRESS INFORMATION BUREAU
GOVERNMENT OF INDIA
UNION FINANCE MINISTER HOLDS PRE-BUDGET CONSULTATION MEETING
WITH THE REPRESENTATIVES FROM BANKING AND FINANCIAL
INSTITUTIONS; ASKS THE REPRESENTATIVES OF THE BANKS AND
FINANCIAL INSTITUTIONS (FIS) FOR JOINT ACTION TO STEER THE
ECONOMY IN THE RIGHT DIRECTION
New Delhi, June 5, 2014
Jyaishtha 15, 1936
The Union Finance Minister Shri Arun Jaitley said that slow down of economic growth
coupled with high inflationary pressure poses a challenge to the economic environment. The
Finance Minister asked the representatives of the Banks and Financial Institutions (FIs) that we
together need to steer the economy in the right direction. The Finance Minister Shri Jaitley was
making the opening remarks during his Pre-Budget Consultations with the representatives of
Banks and Financial Institutions here today.
Along with the Finance Minister, the meeting was attended by Ms. Nirmala Sitharaman,
Minister of State for Finance and Corporate Affairs, Dr. Arvind Mayaram, Finance Secretary,
Shri Ratan P. Watal, Expenditure Secretary, Shri Rajiv Takru, Revenue Secretary, Shri G.S.
Sandhu, Secretary, Financial Services, Dr. Urjit Patel, Deputy Governor, Reserve Bank of India
and other senior officers of the Ministry of Finance among others.
Various suggestions were received from the different representatives of the Banks and
Financial Institutions. Major suggestions include reduction in time limit and number of
adjournments in case of SARFAESI matters for early resolution, statement in budget regarding
recapitalization of public sector banks, dilution of government ownership in public sector banks
up to 51%, implementation f recommendations of Naik Committee Report, removal of mismatch
between asset liability and banks' balance sheets and need for revision of definition of priority
sector lending among others.
Besides it, other suggestions include continuation of interest subvention scheme for the
investment lending in agriculture sector, joint collaborative group about 6 lakh in number
promoted by NABARD be included in priority Sector lending, about 72 lakh Self Help
Groups(SHGs) of women promoted by NABARD be exempted from service tax for the services
rendered by them to small farmers etc, tax benefit limit for health insurance be suitably raised,
tax exemption under Section 80C of the Income Tax Act be raised, Insurance Awareness be
made part of corporate social responsibility(CSR), availability of cheaper credit to 100 Mid Cap
exporters , interest subsidy for solar power projects, setting- up of National Asset Management
Company for dealing with NPAs of the banks, more bolder approach in case of Rajiv Gandhi
Equity Scheme (RGESS) to enlarge its scope, relook at various provisions of New Companies
Bill, inclusion of venture capital in case of small business/entrepreneurs as priority sector lending
and making LIC a Public Limited Company among others..
Other suggestions included abolition of Section 80(P)(4) of the Income Tax Act, 1961 i.e.
free urban cooperative banks from payment of income tax, need for an Umbrella Organisation in
the form of National Level Urban Cooperative Bank (UCB) for all 1600 Primary Cooperative
Banks of India and Rs. 5000 crore as Seed Share Capital to this National Level Apex bank of
UCB Sector, removal of prohibition on admittance of Cooperative Society as a member of Urban
Cooperative Bank existing in Banking Regulation Act, 1948, amendment to Chapter-V of
Finance Act 1994 as amended by Finance Act, 2013 dated 10.5.2013 towards adding
subscriptions of UCB's Association in `Negative List', and amending DICGC Act, 1961 (i) to
raise the existing limit from Rs. one lakh to Rs. three lakh in general and (ii) further to allow
choice to UCBs to insure voluntarily deposits and loans up to Rs. 5 lakh per individual by paying
risk weighted premia.
Representatives from different Banking and Financial Institutions who participated in
today's meeting included Smt. Arundhati Bhattacharya, State Bank of India, Dr. Rajiv B. Lall,
IDFC Ltd., Shri M. Narendra, Indian Overseas Bank (IOB), Shri K.R. Kamath, Punjab National
Bank (PNB), Shri S.S. Mundra, Bank of Baroda (BOB), Shri Sudhir Kumar Jain, Syndicate
Bank, Shri Rajiv Rishi, Central Bank of India, Shri M.S. Raghavan, IDBI, Dr. Harsh Kumar
Bhanwala, NABARD, Shri S.K. Roy, LIC, Shri G. Srinivasan, New India Insurance, Shri
Yaduvendra Mathur, EXIM Bank, Shri S.B. Nayar, India Infrastructure Finance Company Ltd.
(IIFCL), Shri Arnab Roy, National Housing Bank, Ms. Naina Lal Kidwai, HSBC, Shri Sunil
Kaushal, Standard Chartered Bank, Shri Uday Kotak, Kotak Mahindra Bank Ltd, Shri Malay
Mukharjee, IFCI, Ms. Shikha Sharma, Axis Bank Ltd, Shri Mukund L. Abhyankar, National
Federation of Urban Cooperative Banks and Credit Societies Ltd., (NAFCUB) and Shri Raman
Aggarwal, Finance Industry Development Council (FIDC) among others.
The Finance Minister Shri Jaitley assured that the issues raised and suggestions made by
different representatives of Banks and Financial Institutions will be looked into in detail and will
be duly considered.