Officials fear economic meltdown in 2013

.....Although for the record, the Union Ministry of Finance is backing the Reserve Bank of India in its policy of incessantly raising interest rates, and most officials go along with their former colleague RBI Governor D. Subbarao in his restrictive credit stance, others worry that "falling growth caused by RBI policy may make several banks sick". They point out that in 2012, around Rs 200,000 cr of debt restructuring has become inevitable as a consequence of the economic slowdown and policy stasis, and that "this could double to an unsustainable Rs 400,000 cr (of corporate debt needing to be restructured) by mid-2013, if the economy continues to underperform at present rates". ..............

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