Of this, Rs 10,000 crore would be provided to weak public sector banks which require more capital, Financial Services Secretary Hasmukh Adhia said here.
"The first Rs 20,000 crore will happen as early as possible...Once Parliament approval comes for supplementary (demand for grants). Rs 8,000 crore we already have in our budget. Rs 12,000 crore will come, so this Rs 20,000 crore...Can happen by September," he said.
For the current fiscal, the government has allocated Rs 7,940 crore in the Budget for capital infusion in state-owned banks.
The capital has been sought as per the assessment made by the ministry on getting presentation from all public sector banks.
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Adhia further said that the third tranche of capital infusion which would be made in the last quarter of the current fiscal based on improvement in performance.
"It will be based on which banks makes lot of efforts in the first three quarters, whichever banks registers improvement in terms NPA, stressed asset and in terms of their restructuring," he said.
The government intends to make Rs 5,000 crore capital infusion through second Supplementary later this year.
Besides, Adhia said, the government has made four year roadmap of capital requirement of public sector banks to meet Basel III norms, global capital adequacy requirement.
Public sector banks will need to raise Rs 1.10 lakh crore from the markets to meet more than half of their Rs 1.8 lakh crore capital requirement over for the next four years.
Of the Rs 1.80 lakh crore capital requirement estimated by the Finance Ministry, the government is willing to provide only Rs 70,000 crore -- Rs 25,000 crore each in current and next fiscal and Rs 10,000 crore each in 2017-18 and 2018-19.
"Various initiatives taken (to address NPA issue) should work if not in immediate quarter, in next two quarters things should start looking up," he said.
Public sector banks are saddled with the gross NPAs of Rs 2.67 lakh crore at the end of March 2015. The gross NPA of the all banks was Rs 3.09 lakh crore.