The SASHAKT program, launched by the Government of India in July 2018, was a significant initiative specifically designed to address the critical issue of stressed assets within the Indian banking sector. Its primary focus was on Public Sector Undertaking (PSU) Banks, which were heavily burdened by large volumes of non-performing loans.

SASHAKT Program Overview

The SASHAKT program aimed to facilitate the swift and efficient resolution of Non-Performing Assets (NPAs), often referred to as bad loans. These are loans where the borrower has failed to make interest or principal payments for a prolonged period, leading to financial strain on banks. The program was a strategic move to clean up bank balance sheets and restore their lending capacity, which is crucial for economic growth.

• The initiative was conceptualized by a committee led by Sunil Mehta, the then non-executive chairman of Punjab National Bank (PNB).
• It sought to improve the flow of credit in the economy by resolving the issues of capital trapped in non-performing loans.
• The program proposed a tiered approach for asset resolution, depending on the size of the stressed asset, ensuring a tailored solution for different categories of bad loans.

Stressed Assets Resolution Mechanism

The SASHAKT program introduced a structured framework for stressed assets resolution. Here are the key mechanisms it proposed:

The core idea was to reduce the time taken for resolution and bring greater transparency and accountability to the process, thereby strengthening the overall financial health of PSU Banks.

Analysis of Options

Let's analyze why other options do not align with the purpose of the SASHAKT program:

• Option 2: to provide institutional Credit to marginal farmers in rural areas. This objective is typically covered by agricultural credit schemes such as Kisan Credit Card (KCC) or subsidies aimed at farmers, not a program focused on large-scale bank asset resolution like SASHAKT.
• Option 3: to empower women in rural areas. This goal is addressed by various government initiatives and schemes aimed at women's empowerment, self-help groups (SHGs), and rural livelihood missions. The SASHAKT program has no direct connection to women empowerment.
• Option 4: to ensure Community participation in development projects. This refers to local governance and community development programs, often facilitated through Panchayati Raj institutions or specific area development schemes. SASHAKT operates within the financial and banking sector, distinct from community development.

Thus, the SASHAKT program was unequivocally launched by the Government of India in July 2018 for the dedicated purpose of resolving stressed assets with PSU Banks, making Option 1 the accurate description of its objective.