The decision to increase MSP augurs well for rural India and will help boost rural demand. The impact on inflation depends on the formula that the government will use to determine the MSP.

With the stabilisation of GST, uptake of credit in FY 2018-19 will come from the manufacturing sector on the back of expected nominal GDP growth of 11-12%.

Agri-commodity prices are expected to be less volatile in FY18-19 as compared last year, based on the expectation of a reasonably good monsoon.

The bank has witnessed a good year-on-year growth in the commercial vehicles segment from December 2017 to March 2018. Currently, there are about 7 million commercial vehicles on the road, and replacement demand itself contributes substantially to fresh demand every year. Besides, the government’s focus on infrastructure and better connectivity will create additional demand for vehicles.

Growth in CV segment is expected to be 10% this year.  Post-2011-12, disbursements were reduced but in the last two years, the company has gone in aggressively into the segment.

The Agri-Market Infrastructure Fund is a good concept, and will link about 22,000 rural markets to the electronic national agricultural market platform. The efficiencies following the linkage will eventually result in lowering the inflation.

 However, there are issues even now affecting the farmers. There are various reasons for that, such as the number of agri-commodities being so large in India, making it difficult to manage; then there is standardisation, which is a challenge. But over the next three-five years, these issues should get sorted out.

Post-demonetisation and the introduction of GST, the SME sector was impacted the most. The bank witnessed some stress during 2017-18 in the SME books, which is now showing signs of stabilisation. This year is bullish because all disruptions [positive though] are over. However, resolution of the NPAs needs to be speeded up.

 Digital has become an important channel in staying connected with customers and offering seamless and quick services. Recently, we rolled out the Kotak GST platform, which facilitates SME clients to file quarterly and annual returns and get consolidated reports.

Microfinance institutions have seen consolidation in the last few months. Our BSS-sourced microfinance book has grown by 50% this year, and is expected to further grow by 50% FY 2018-19.

The bank is looking at expanding BSS’ footprint, which has so far been present in Karnataka and parts of Maharashtra, by setting up offices in other States, including Madhya Pradesh and Tamil Nadu.