The core problem of NPAs is with very large corporates, though few in numbers, which are predominantly in the steel, power, infrastructure and textile sectors, Jaitley said at the Parliamentary Consultative Committee meeting.
"To deal with the NPAs of the banks is a challenging task even though the NPAs have shown a declining trend in the last quarter of the current financial year," Jaitley said.
He said some corporates have expanded their capacity during the boom period from 2003-2008, but could not face the onslaught of global financial crisis and consequent slow down thereafter.
"The government is taking sectoral specific measures to deal with the problem of NPAs specifically in the resolution of large debts... Steel Sector is on its path of recovery while many decisions have been taken in the infrastructure, power and textile Sectors to resolve their problems," Jaitley said.
The gross NPAs of public sector banks have risen from Rs 5.02 lakh crore at the end of March 2016 to Rs 6.06 lakh crore in December 2016.
The members of Consultative Committee too gave various suggestions in order to deal with the NPAs of PSBs.
Some Parliamentarians suggested that apart from recovery proceedings, criminal action must be taken against the big wilful defaulters and their photographs may also be published, a finance ministry statement said.
"A member also suggested that under the SARFAESI Act, the focus should be on catching big wilful defaulters," the statement added.
Jaitley said the RBI has set up an Oversight Committee to look into process of the cases referred to it by the different banks. "Seeing the response and its performance, the Government is considering multiplication of such committees".
On the issue of setting-up a 'bad bank', Jaitley said that several possible alternatives exist and the issue is being debated on public platforms.
The Finance Minister further said the Insolvency and Bankruptcy Board of India (IBBI) has already been set up under the Insolvency and Bankruptcy Code, 2016.
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