The Finance Ministry has decided not to urge the Reserve Bank of India to relax its prompt corrective action (PCA) mechanism, but this can scarcely address the real issues like non-performing assets (NPAs) or bad loans. Neither the PCA nor any other framework can cure the banking sector, for the problem is structural rather than functional: it is the government ownership that is at the heart of the rot. Which also explains why state-run have the highest NPAs.
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