India's economic recovery to cut bank stress, but Covid hit to be felt: S&P

An improvement in India's macroeconomic conditions is likely to alleviate stress for the country's banking sector. However, a hit from Covid-19 pandemic is inevitable, according to "Banking Industry Country Risk Assessment: India", a report by S&P Global Ratings.

Rating agency Standard and Poor’s (S&P) in a statement said the Indian government's strong efforts to shield banks from the Covid-19 pandemic have been largely successful.

While the Indian economy is on a mend, the permanent GDP loss stemming from the brunt of the coronavirus is huge at 10 per cent.

The banking system's weak loans are estimated at 12 per cent