While presenting the General Budget 2016-17 in Lok Sabha today, finance minister Arun Jaitley said that in the financial sector, a comprehensive Code on Resolution of Financial Firms will be enacted. Together with the Bankruptcy and Insolvency Law, major reform measure will fill a major systemic vacuum.
Announcing more financial sector reforms, he said SEBI will develop new derivative products in the commodity derivatives market. Statutory basis will be provided for a Monetary Policy framework and a Monetary Policy Committee through the Finance Bill 2016. A Financial Data Management Centre will also be set up to facilitate integrated data aggregation and analysis in the financial sector.
The SARFAESI Act will be amended to strengthen Asset Reconstruction Companies, which will help in dealing with the stressed assets of banks. In the plan for revamping of Public Sector Banks (PSB), he announced:
a. allocation of Rs25,000 crore towards recapitalisation of PSBs;
b. setting out a roadmap for consolidation of PSBs;
c. considering reduction of government equity in IDBI Bank to 49 per cent or below;
d. Debt Recovery Tribunals (DRTs) to be strengthened with computerised processing of court cases.
Target of amount sanctioned under Pradhan Mantri Mudra Yojana is proposed to be increased to Rs1,80,000 crore. General Insurance Companies will be listed in stock exchanges for improving transparency, accountability and efficiency. Comprehensive Central legislation to deal with Illicit Deposit Taking schemes will be enacted.
To provide better access to financial services, especially in rural areas, the government will undertake a massive nationwide rollout of ATMs and Micro ATMs in post offices over the next three years, Jaitley announced.