Government’s focus on housing and infrastructure to continue: Karthik Srinivasan

“So, as such, we are not really expecting any major detour in terms of the way forward for the BFSI sector as such,” says Karthik Srinivasan, ICRA.

What impact do you anticipate from the continuity in policy directives on the financial sector, particularly in relation to the government’s focus on housing and infrastructure, and how might this influence the banking system‘s role in supporting these initiatives?
Largely the same. We expect continuity in the policy directives on the financial sector. So, to that extent, we do expect the government’s focus on housing and infrastructure to really continue, which would mean some way you would have to use the banking system to ensure that you are able to pass on or at least continue on those initiatives. So, as such, we are not really expecting any major detour in terms of the way forward for the BFSI sector as such.

World Bank has recently said that the growth will continue at about an average of 6.7%. What are your thoughts on that as well?
As I said in terms of GDP growth, we do expect the country to continue in 6.5% to 7% kind of growth rates for next couple of years, so that would definitely give a lot of opportunity for the BFSI sector to expand on credit and as Amit said, the banks and the non-banks are possibly at the best of their financial health over the last 10 years, so that should provide them equal and more than equal opportunities for them to cherry pick and continue on the growth path with fairly strong profitability and asset quality numbers.