Can ‘bad bank’ save our stressed economy?

The Indian economy has been reeling under the stress of non-performing loans for quite some time now, and the government and the Reserve Bank of India (RBI) have, over time, introduced several measures to contain the rising growth of stressed assets. Even before the COVID-19 pandemic, the incumbent stress had slowly but steadily blown into a crisis. Unfortunately, with the COVID-19 pandemic affecting economic sectors across the board, this problem has become worse. Enter: ‘Bad Bank’.

The term has found itself in much limelight again after the Finance Minister’s 2021 annual Budget speech. While many are hopeful that this is perhaps the need of the hour, others are quite skeptical due to India’s previous experience with this.

Please click here to read the full article by Anish Mashruwala & Neelasha Nemani, published in The Economic Times.