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High stock of NPAs in India: IMF
Why is it in the news
- According to a statement by IMF head of Monetary and Capital Markets, there continues to be a high stock of non-performing assets (NPAs) in India and there has been some progression.
More in the news
Statements from IMF report and oficials:
- The level of capitalisation of some banks, particularly government-owned banks should be bolstered.
- There were some steps taken by the authorities to boost capital buffers in banks and also governments in state-owned banks, that have had some positive impact.
- Portfolio flows to emerging markets are influenced by benchmark-driven investors- 70% of country allocations of investment funds are impacted by benchmark indices.
- This category of investors are more sensitive to global financial conditions and as they command increasing shares of portfolio flows, external shocks may propagate to medium-size.
- China is likely to become more important for other emerging markets as it gets included in benchmark indices.
- Portfolio flows to China are expected to increase by $150 billion by 2020 due to its inclusion in a global bond index.
IMF:
- The International Monetary Fund (IMF) is an organization of 189 countries whose primary purpose is to ensure the stability of the international monetary system.
- IMF is headquartered in Washington, D.C.
- Its other objectives are :(1) Working to foster global monetary cooperation.(2) Secure financial stability.(3) Facilitate international trade.(4) Promote high employment and sustainable economic growth.(5) Reduce poverty around the world.
Source
The Hindu.