Contest2:The bane of NPA's in the country

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According to a RBI report the gross Non Performing Assets of the Public Sector Banks are just 

under 4 Lakh Crores. Punjab National Bank at the end of the last financial year posted worst 

loss in their & Bank's history, which was majorly contributed by NPAs . NPAs are crippling

 banks activities which is becoming detrimental to India's growth.

There are many reasons for this increase in NPAs. The major reason is the aggressive lending by 

the bank during boom period without proper background checks. Now the major part of the NPA is

 contributed by Industries and Corporate. After the financial crisis the profits of these firms 

dwindled which resulted in their defaulting on loans. There are other reasons like delay in

 environmental clearance, volatility in the price of raw material , cancellation of projects and 

willful defaulting all contributed to the rising menace of NPAs.

Government and RBI have taken several steps to address this issue. Mission Indradhanush was 

introduced by the government to bring clarity and to make banks more professional. RBI introduced 

CDR or Corporate Debt Restructuring. Then ARC or Asset Reconstructing Companies was also launched. This  mainly works by taking away the NPAs of the banks and try to get the money back by selling assets. Joint Lenders Forum was also established by the RBI. SDR or Strategic Debt Restructuring was also introduced where banks become part owner of the company. Other measures that banks can take are proper credit management systems and analyse beforehand the asset most likely to become NPA.

Banks needs to work freely without the pressure of NPA. It's is high time we wake up and try to solve

 this menace. We are still a developing country and banks are required to work to their full potential 

for our economy to grow in this tough global financial environment.