The government is not likely to use its powers to issue directions to the Reserve Bank of India (RBI) to seek relief for stressed power plants, a top finance ministry official said.
“The government is unlikely to issue directions to RBI under Section 7 of RBI Act. The section can be invoked only in exceptional circumstances and the power asset issue is too small to enforce Section 7,” the official said.
Policy makers are not keen on setting a precedent on use of Section 7 on such an issue. The Allahabad High Court had in its ruling earlier this week told the government to consider issuing a directive to RBI against the February 12 circular on how lenders should deal with stressed assets. Read More
Latest posts by The Economic Times (see all)
- Transformation of railways in NDA budgets - January 19, 2019
- Mahanadi coalfields loses 20 million tonne production due to strikes - January 19, 2019
- Bad bets on oil, gas spark wave of energy-fund closures - January 18, 2019