Sitharaman reviews PSBs preparedness to tackle Omicron

Amid speculation that the Union Budget may come up with fresh incentives for the services sector beaten badly by the pandemic, Finance Minister Nirmala Sitharaman on Friday told the Public Sector Banks' heads that contact-intensive sectors may need more support to help them fight the pandemic.

In a review meeting to gauge the readiness of the lenders to tackle possible future disruption caused by the Omicron, Sitharaman asked bankers to continue support to sectors such as agriculture, retail and small and medium sectors.

"During the review meeting, FM Smt. @nsitharaman assessed various steps taken by PSBs in implementing pandemic-related measures initiated by GoI and RBI and readiness to tackle possible future disruptions that may occur due to the ongoing variants of the COVID19 pandemic," the finance ministry tweeted.

This comes after the Reserve Bank of India had earlier this year given a slew of incentives including Rs 15,000 crore special liquidity window for contact-intensive sectors such as hotels and restaurants, tourism-travel, aviation ancillary services and other services that included private bus operators, car repair services, rent-a-car service providers, event/conference organizers, spa clinics, and beauty parlours/saloons.

These sectors were hit by lockdowns in states amid the raging Covid pandemic. Many contact-intensive industries are yet to reach their pre-pandemic levels

Trade, hotels and transportation services sector constitutes around 12 per cent of India's economy. This is the sector, where unorganised workers comprise 64 per cent of the workforce.

The Union Budget is expected to announce new measures of amelioration of the entire services sector, which consists of almost 60 per cent of India's economy, and, a few more incentives.

Sitharaman said public sector banks recorded net profit of Rs 31,820 crore in FY 2020-21 which is the highest in the last five financial years.

Net profit of Rs 31,145 crore for the first half of FY2021-22 was almost equal to that of FY 2020-21. The ministry added PSBs have effected a recovery of Rs 5,49,327 crore during the last 7 financial years.

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