The Indian government is opposed to cryptocurrencies but is receptive to blockchain technologies.

The government said on Tuesday that it will take all necessary steps to prevent crypto-assets from being used to support illegal activities or as part of the accounting mechanism.

Minister of State for Finance Pankaj Chaudhary stated in a written reply to Rajya Sabha that the government will aggressively investigate the use of blockchain technology to usher in the global marketplace.

“The government does not consider crypto-currencies legal tender or coin and will take all measures to eliminate use of these crypto-assets in financing illegitimate activities or as part of the payment system,” he stated.

In its report, a High-Level Inter-Ministerial Committee (IMC) chaired by the Secretary (Economic Affairs) to study the issues surrounding virtual currencies and propose specific actions to be taken in this area recommended that all private cryptocurrencies be prohibited in India, with the exception of any cryptocurrency issued by the government.

The government would decide on the IMC’s recommendations, and any legislative proposals, if any, would be submitted in Parliament in accordance with the proper procedures, according to the minister.

In a separate response, Minister of State for Finance Bhagwat Karad stated that public sector banks (PSBs) have retrieved 4,52,480 crore from debtors in NPA and written-off accounts over the last five financial years, and have recovered a total of 20,334 crores from wilful defaulters through March 31, 2021.

He went on to say that the RBI has had data on willful defaulters since 2019 and that according to data provided by banks to CRILC, the total number of individual wilful defaulters reported by nationalized banks increased to 248 in 2019-20, then fell to 156 in 2020-21.

In another response, Karad stated that gross NPAs reported to CRILC by public and private sector banks amounted to 66.8% of overall gross NPAs (including exposures that are not classified as corporate exposure since they are between 5 crore and 7.5 crores).

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