A Rs 2.11 lakh crore public sector banks capitalisation plan for next two years was approved by the government on 24/10/2017 in an effort to clean banks, books and revive investment in a slowing economy.
Details of public sector banks capitalisation plan:
As explained by financial services secretary of India Mr. Rajiv Kumar, the sum of total Rs 2.11 lakh crore will be divided into two parts Rs 1.35 lakh crore and Rs 76,000 crore. Rs. 1.35 Lakh Crore will be used for recapitalisation bonds whereas Rs 76,000 crore will come from budgetary support and equity issuance.
Finance minister Arun Jaitely told in brief that state banks recapitalisation will be done after a series of reforms and the nature and details of bonds will be made public during course of time.
Finance minister also announced to provide Rs 18,000 crore to banks under the Indradhanush plan. Indradhanush plan was introduced by the government in 2015, under which government had announced to infuse Rs 70,000 crore in state- run banks over four years to meet their capital requirement in line with global risk norms.