SC shocked over magnitude of Karnataka's illegal mining

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.

Thiruvananthapuram, Apr 24: The month of Ramzan will be observed from Friday in Kerala.
The crescent moon was seen at Kappad beach in Kozhikode on Thursday.

Amid nationwide lockdown in the wake of COVID-19, there will be no group prayers at mosques. The devotees have been directed to offer prayers at homes.

Palayam Mosque Imam, VP Suhaib said, "Usually at mosques in Thiruvananthapuram, devotees used to come to break the fast... But this year, amid lockdown, we direct people to prepare food at home and break the fast with family. Also, there will not be group prayers at mosques. People should pray at home."
"Imams and scholars have strictly directed people to observe all Ramzan-related prayers at home. There is no other option... Human life is the most important thing. Only if life exists, belief and religion can exist," he added.

Prime Minister Narendra Modi had on March 24 announced a 21-day nationwide lockdown as a precautionary measure to contain the spread of COVID-19. Later, the lockdown was extended till May 3.

Thiruvananthapuram, Jan 25: Kerala Chief Minister Pinarayi Vijayan on Friday asked the state's MPs to take up the matter of deaths of eight Keralites at a resort in Nepal early this week, with the Centre to pursue the matter with the neighbouring country's government.

He was speaking to the MPs at the customary meeting that the Chief Minister has with all MPs ahead of every session of the parliament.

"The demand has come from the families of the victims for a fair probe on what happened and adequate compensation. For this, you (MPs) should take it up with the Centre. A probe has to be done by the Nepal authorities and the Centre should pursue this with them," Pinarayi reportedly stated. 

"We (the state government) have already taken the issue with the Centre and will now send a detailed letter on the need for a fair probe by the Nepal authorities," he added.

The eight dead include Praveen Krishnan Nair, who worked in the UAE and was on a short vacation here, when the tragedy struck the family. His wife Saranya, a second year M.Pharma student, and their three children, were also killed.

On Friday morning, it was a goodbye that Thiruvananthapuram has perhaps not seen before, as hundreds of people, many of them strangers, came to pay last respects to the five members of the Nair family.

The family of Praveen Nair decided to bury the bodies of the three children and cremate the bodies of Praveen and Saranya. It was also decided to bury the ashes of the couple alongside their three children in the compound of their house.

The second family hailed from Kozhikode and the bodies of Ranjith, an IT professional, his wife, who works in a cooperative bank and their younger child, who slept in the same room as that of Praveen, arrived at the Kozhikode airport on Friday morning.

State Transport Minister A.K. Saseendran and many others were there to receive the bodies, which were first taken to Ranjith's new home that is almost complete.

From there it was taken to a hall for all to pay their last respects and then to the family home of Ranjith where the cremation took place.

Watching everything happening was Ranjith's elder son, seven-year-old Madhav, who escaped that night in Nepal as he was sleeping in another room.

Madhav had arrived from Delhi on Thursday and was unaware of the tragedy as he was busy moving around in a new bicycle, which his relatives had bought to keep him busy.