Violence cost India’s GDP over Rs 80 lakh crore on PPP basis; 40K per person

Munbai/New Delhi, May 4: India expects bad debts at its banks could double after the coronavirus crisis brought the economy to a sudden halt, a senior government official and four top bankers said.

Indian banks are already grappling with 9.35 trillion rupees ($123 billion) of soured loans, which was equivalent to about 9.1% of their total assets at the end of September 2019.

"There is a considered view in the government that bank non-performing assets (NPAs) could double to 18-20% by the end of the fiscal year, as 20-25% of outstanding loans face a risk of default," the official with direct knowledge of the matter said.

A fresh surge in bad debt could hit credit growth and delay India's recovery from the coronavirus pandemic.

"These are unprecedented times and the way it's going we can expect banks to report double the amount of NPAs from what we've seen in earlier quarters," the finance head of a top public sector bank told Reuters.

The official and bankers declined to be named as they were not officially authorized to discuss the matter with media.

India's finance ministry declined to comment, while the Reserve Bank of India and Indian Banks' Association, the main industry body, did not immediately respond to emails seeking comment.

The Indian economy has ground to a standstill amid a 40-day nationwide lockdown to rein in the spread of coronavirus cases.

The lockdown has now been extended by a further two weeks, but the government has begun to ease some restrictions in districts that are relatively unscathed by the virus.

India has so far recorded nearly 40,000 cases of the coronavirus and more than 1,300 deaths from COVID-19, the respiratory disease caused by the coronavirus.

'RIDING THE TIGER'

Bankers fear it is unlikely that the economy will fully open up before June or July, and loans, especially those to small- and medium-sized businesses which constitute nearly 20% of overall credit, may be among the worst affected.

This is because all 10 of India's largest cities fall in high-risk red zones, where restrictions will remain stringent.

A report by Axis Bank said that these red zones, which contribute significantly to India's economy, account for roughly 83% of the overall loans made by its banks as of December.

One of the sources, an executive director of a public sector bank, said that economic growth had been sluggish and risks had been heightened, even ahead of the coronavirus crisis.

"Now we have this Black Swan event which means without any meaningful government stimulus, the economy will be in tatters for several more quarters," he said.

McKinsey & Co last month forecast India's economy could contract by around 20% in the three months through June, if the lockdown was extended to mid-May, and growth in the fiscal year was likely to fall 2% to 3%.

Bankers say the only way to stem the steep rise in bad loans is if the RBI significantly relaxes bad asset recognition rules.

Banks have asked the central bank to allow all loans to be categorized as NPAs only after 180 days, which is double the current 90-day window.

"The lockdown is like riding the tiger, once we get off it we'll be in a difficult position," a senior private sector banker said.

New Delhi, Apr 16: South Delhi District Magistrate Brij Mohan Mishra on Thursday said that the administration is investigating how the pizza delivery boy contracted the coronavirus.

"In the last 15 days, we discovered houses he had delivered food. We contacted people living in 72 houses and they have been asked to stay in-home quarantine. No symptoms have been seen in people related to him. 

Testing of his roommate has been done and his reports are awaited. The rest of the people don't have any symptoms, they have been placed under institutional quarantine. Those in-home quarantines are also asymptomatic," Mishra said.

"Unless a positive case comes, we feel that transmission has not taken place. The boy told us that he was continuously wearing a mask while delivering the food. We are also finding out how he got infected. We are getting the information about the places he visited for delivery. He was tested on the basis of the doctor's advice. Later, he tested positive," he said.

72 families have to stay in home quarantine in the Malviya Nagar area after the delivery boy tested positive for COVID-19 on Wednesday.
Delhi Health Minister Satyendra Jain said that 17 other delivery boys linked with the infected person have also been placed under institutional quarantine.

"A pizza delivery boy has been detected with COVID-19 here. 17 other delivery boys linked with him have been placed under institutional quarantine and 72 people have been placed under home quarantine," Jain said.

Food delivery app Zomato said that the staff of the infected person's restaurant has delivered some orders which were placed on its platform.

"We've been made aware today that a restaurant's employee, who has been recently tested positive for COVID-19, had delivered food in the past to a few customers in the Malviya Nagar area in Delhi. All these customers have already been contacted by the govt authorities... We are not sure whether the rider was infected at the time of delivery," the company said in a statement.

Zomato also claimed that colleagues of the delivery boy have tested negative for COVID-19.
"This restaurant had instructed their riders to wear masks and follow strict hygiene to keep customers safe from any unintended mishap.

All co-workers of the said rider have been tested negative. And as a precaution, the restaurant where this rider worked has suspended operations," read the statement.

Amaravati, Jan 21: Telugu Desam Party president N Chandrababu Naidu and at least 17 MLAs of his party were taken in police custody late on Monday as they tried to conduct a foot march from the state assembly to nearby Mandadam village in violation of prohibitory orders.

TDP leaders started off on the march after staging a sit-in near the assembly main entrance following the suspension of 17 MLAs from the House for the day.

They were protesting the AP Decentralisation and Inclusive Development of All Regions Bill, 2020, that was passed by the assembly, enabling the establishment of three capitals for the state.

The TDP leaders were taken to the Mangalagiri police station.

Meanwhile, tensions prevailed at the Jana Sena Party headquarters at Mangalagiri as police prevented its president Pawan Kalyan from proceeding to the Amaravati region to speak to protesters fighting for the retention of only one capital for the state.

DIG Kanti Rana Tata and other senior police officials reached the Sena office and blocked the exit of Kalyan and political affairs committee chairman Nadendla Manohar, resulting in an argument.

Kalyan asked how could police impose restrictions within his own office.

Scores of Sena workers gathered outside the office even as a large posse of police was posted to thwart Kalyan and other leaders' plans.