Increasing flow of NPAs

India has a very low, though improving, Credit-GDP ratio (51% as on March 31, 2007 as compared to 30% as on March 31, 2000, as per RBI’s annual report for FY07). With the increase in this ratio, the flow of NPAs would also increase. NPAs are mostly industrial assets – exposure to ‘bubble sectors’ being minimal. Further, the resolution of larger cases (80% by value) requires intense workout by way of corporate restructuring, business sale or combination of both.