An Analysis of Indian Banking Sector and Economic Development
Banking stability, economic growth, India, VECM, financial development, non-performing assets, capital adequacy
This study looks at the dynamic, reciprocal link between India's economic growth and the stability of its banking sector. The study uses macroeconomic and financial data from 1991 to 2024 to investigate how banking sector indicators—namely, non-performing assets (NPAs), capital adequacy ratio (CAR), credit-to-GDP ratio, and interest rate spreads—influence real GDP growth using time-series econometric techniques like Vector Error Correction Models (VECM) and Granger causality analysis. With evidence of both short-term volatility and long-term causation from banking stability to economic production, the empirical results point to a long-term equilibrium link between banking stability and economic growth. The findings highlight how important a strong, stable banking industry is for enabling loan distribution, boosting investor confidence, and advancing macroeconomic stability. In order to protect financial stability and promote sustainable economic growth in India, the report ends with policy proposals targeted at bolstering regulatory supervision, enhancing asset quality, and guaranteeing proactive crisis management.
"An Analysis of Indian Banking Sector and Economic Development", JETNR - JOURNAL OF EMERGING TRENDS AND NOVEL RESEARCH (www.JETNR.org), ISSN:2984-9276, Vol.4, Issue 4, page no.b324-b334, April-2026, Available :https://rjpn.org/JETNR/papers/JETNR2603320.pdf
Volume 4
Issue 4,
April-2026
Pages : b324-b334
Paper Reg. ID: JETNR_233411
Published Paper Id: JETNR2603320
Downloads: 00053
Research Area: Commerce All
Country: SHIMLA, Himachal Pradesh, India
ISSN: 2984-9276 | IMPACT FACTOR: 9.87 Calculated By Google Scholar | ESTD YEAR: 2023
An International Scholarly Open Access Journal, Peer-Reviewed, Refereed Journal Impact Factor 9.87 Calculate by Google Scholar and Semantic Scholar | AI-Powered Research Tool, Multidisciplinary, Monthly, Multilanguage Journal Indexing in All Major Database & Metadata, Citation Generator
Publisher: RJPN (IJPublication) Janvi Wave
