Days after taking over the reins of Finance Ministry, Piyush Goyal has set his eyes on clearing the mess plaguing the banking sector. While Goyal's tenure as the Finance Minister is going to be ephemeral, the former chartered accountant turned investment banker has already set the ball rolling to improve the financial health of country's public sector banks.
In his first meeting with heads of the banks under RBI's Prompt Corrective Action (PCA) plan, Goyal said, "We will ensure very orderly growth of the industry and highest levels of probity and accountability that is expected of public sector banks."
Goyal, who bagged the additional charge of Union Finance Ministry, will stay on until Arun Jaitley recovers from a kidney transplant surgery. His appointment comes amid recent scams and frauds at various state-run lenders that have continued to hog the headlines since the beginning of this year. Not to mention the mounting bad debts or NPAs of these government-owned banks.
Known as one of the key lieutenants of Prime Minister Narendra Modi, Goyal, who holds two heavyweight portfolios as Minister of Railways and Minister of Coal, has not made a big deal of getting additional charge of the finance ministry and largely operates from his Rail Bhawan office.
"Yesterday I had an occasion to talk to him and take his guidance. He has given me some issues (which) I am following," Goyal said after his meeting with bank executives. "The priority is to ensure that we can quickly get entire banking system on its feet and shed the legacy that was inherited by this government in 2014...Indiscriminate lending of the past has caused this distress that the banking sector is facing," he added.
The legacy he referred to was apparently the indiscreet loans given under the previous UPA government. Many companies, especially in the power, steel and telecom sectors, have been unable to pay their debts. To compound the problem, there has been a string of scandals that have come to light over the past couple of months, hurting the image of banks - the heart of the economy.
During the course of his three-decade-long political career, Goyal has held several important positions at different levels in "the world's largest political party", the Bharatiya Janata Party (BJP). He was BJPs national treasurer and also oversaw the party's successful publicity and advertising campaign for the 2014 general elections. His political fortunes turned when he was inducted in the Modi ministry in May 2014 as the Minister of State (Independent Charge) for Power, Coal, New & Renewable Energy.
His tenure saw transformational changes in India's power sector including the roll-out of the most comprehensive power sector reform ever (UDAY), the success of the world's largest LED bulb distribution programme (UJALA) for energy efficiency and fast tracking electrification of nearly 18,000 unelectrified villages. His other achievements include the elimination of coal shortages to improve the nation's energy security and successful conduct of transparent e-auctions of coal blocks.
Goyal's political career graph took off big time at another big cabinet shuffle last year after then Railways Minister Suresh Prabhu accepted moral responsibility for a spate of train accidents and offered to step down. After Goyal stepped into his shoes, the Indian Railways bagged the highest ever budgetary allocation - a whopping Rs 1.48 lakh crore - and plans are afoot to redevelop and modernise 90 railway stations across the country before the 2019 Lok Sabha elections.