By Sidhartha The Economic times
NEW DELHI: A controversial RBI circular issued
in February may emerge as another point of contention with a section in the
government of the view that the regulator intruded onto its turf.
While banning debt restructuring schemes, RBI
decided to terminate the ‘5/25 scheme’ for bank loans for long-gestation
infrastructure and core sector industries. Government officials believe RBI
went ahead with the move despite the scheme being announced in Parliament in
the 2014 budget. “Can the government ever issue instructions to banks
under the Banking Regulation Act?” asked an official.
The circular is likely to be discussed at RBI’s
board meeting on Monday.
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