Did the roots of high NPAs in Indian Banking Sector lie in the Regulatory Forbearance Policy: Evidence from the trends in NPAs of Post-GFC?

Abstract

The economic progression of a country depends upon the efficiency and health of the financial sector of the economy. Commercial banking undertakings are a vital part of the financial system as these undertakings are important instruments of capital mobilization for economic progression. Moreover, these institutions are used as a tool for controlling the inflation/ deflation in the economy and help in bringing economic stability. In modern days, banking institutions have a tactical role in the economy and their strategies and policies significantly affect the rate of economic progression, level of employment, price-level, growth of GDP, etc.