ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Change of Guard

of NPAs accounted for by the priority sector. That in turn may be used to support the campaign initiated by the first Narasimham Committee on financial sector reform when it advocated phasing out of priority sector lending by banks. The larger the share of such lending in NPAs, the stronger will appear to be the case for phasing it out as being a drag on the banks' viability. It may not be entirely fortuitous that the Indian Banks' Association has, in its memorandum to the new Narasimham Committee, demanded that priority sector lending be reduced to just 10 per cent.

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