India may need to pump Rs 1.5 trn into coronavirus-hit state banks: Report

India may need to inject up to Rs 1.5 trillion ($19.81 billion) into its state-owned lenders as their pile of soured assets is expected to double during the coronavirus pandemic, three government and banking sources told Reuters.

The government initially considered a budget of around Rs 250 billion for bank recapitalisations but that has risen significantly, a senior government source with direct knowledge of the matter said, with loan defaults likely to rise as businesses take a severe hit from nationwide lockdowns to tackle the coronavirus.

"The situation is very grim," the source said, adding that banks would require fresh funds soon.

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