‘Tonic-like’ meet with bankers gave no sense of slowdow

Amid concerns of a slowing economy, Finance Minister Nirmala Sitharaman on Thursday said she has not got any message of consumption slump or cash crunch to businesses after a “tonic-like” meeting with private sector bank heads here, who also said that vehicle sales would re-bounce in a quarter or two.

“The message I get from this meeting today is that consumption is happening. demand will get back and motivate our economy to move at a faster rate. The coming half year, things will have to look up and pep up every other sector, even if there are one or two sectors in which there may be some stress,” she told reporters after an over three-hour meeting with private banks and financial institutions.

Sitharaman said if there was a problem of liquidity, it was in the wholesale financing, and not in the retail.

“On the whole, it was very tonic-like meeting, where I heard a lot of positive things. Not one voice said there was a concern, shortfall of demand. None of them voiced liquidity concerns,” the minister said amid data on the ground showing the contrary.

She said the bankers were optimistic that vehicle sales would rebound as the commercial segment was down due to cyclical reasons and passenger vehicles suffered because of low sentiments.

The minister said the service sector was showing a very high appetite for credit, the minister said. Official data, however, showed that both urban and rural consumers had cut spending as economic growth slowdown triggered job losses.

After the meeting, private sector banks agreed to join the loan mela programme in 400 districts for potential lending ahead of the festive season.

On PMC Bank crisis, the minister said at this stage, RBI was handling the matter.

“Let there a comprehensive picture emerge post which the government will have to see what best can be done so that there is some assurance given to people who are affected,” she said.