TIL Desk/Business/Gurugram/ Finance Minister Arun Jaitley today said more capital for state-owned banks will prompt the PSBs to increase credit flow to MSMEs so that the ‘third engine’ of private investment is fired up to propel growth and create jobs.
Last month, the government had unveiled a whopping Rs 2.11-lakh crore two-year road map to strengthen NPA-hit public sector banks (PSBs), which includes recapitalisation bonds, budgetary support and equity dilution.
As for the engines of growth, there has been a significant increase in public investment and FDI inflows, but the private investment has continued to lag. “If you look at the big picture of the economy where governments are spending a lot of public money, a lot of foreign investment is coming in.
“We need the third engine (private investment) also to fire and a robust private sector and MSME sector so that the optimum growth rate which we have the potential for can be reached,” Jaitley said in his address to top officials at the first PSB Manthan here.
