Why Are Banks Worried About RBI’s New Project Finance Rules?

The Reserve Bank of India's (RBI) proposed changes for project financing could significantly alter how infrastructure and real estate projects are funded. The central bank has suggested increasing the provisioning for all project-backed loans to enhance accountability and project viability. A recent government survey of 1,873 projects revealed substantial delays and cost overruns, highlighting the need for stricter regulations. Yet, the new guidelines have sparked debate among banks and companies, who argue that higher provisions could impact profitability and increase capital costs. With stakeholders invited to comment until June 15, host Anirban Chowdhury delves into whether these norms will ultimately benefit or hinder the sector. Tune in to The Morning Brief podcast for an in-depth analysis from Anil Gupta, head of financial sector ratings at ICRA, Shravan Sampath, a renewable energy sector professional, and ET’s Sangita Mehta.

Check out the other interesting episodes like Polls On My Pod: Saturation States of Rajasthan & MP, Polls On My Pod: Muted Manipur & The Tamil Nadu Triangle, Arvind Kejriwal’s Arrest: An Opposition Shaken or Stirred?, Alliance Arithmetic: Decoding the Political Jigsaw of Lok Sabha Elections 2024, and more!

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