Improvement in the profile of the sector — financial, conduct and practices - will have to be seen on ground, and only then will the banks
get the confidence to provide further support to the sector, he said.
SBI has a total exposure of over Rs 70 billion to the sector out of total Rs 700 billion held by all lenders cumulatively.
Khara said SBI is looking to be a part of a committee that is being set up with an objective to restore business confidence in this industry.
Speaking at the seminar, Union Commerce Secretary Rita Teaotia said: “Self-discipline needs to be maintained by the gems and jewellery industry with better sharing of information.
While the industry claims to have just 1 per cent of the non-performing assets (NPAs) of the entire banking system, one default has shaken the entire industry resulting into massive loss to lenders. More than the industry, the recent scam (PNB-Nirav Modi) is a failure of our own banking system.”
While the industry claims to have no impact so far of the scam on its credit limit for the financial year 2018-19, industry watchers anticipate a blow to the industry in the future.
Union Minister of Commerce and Industry Suresh Prabhu, speaking at the seminar, denied support to unethical and illegal business, but at the same time promised support to genuine business for rapid growth of the gems and jewellery sector.