The Indian government may need to infuse up to 1.5 trillion rupees of capital into public sector banks as asset quality continues to weaken due to a likely economic downturn brought by the COVID-19 pandemic, Reuters reported May 27, citing three government and banking sources.

Negotiations are still ongoing regarding the capital injection plans and a final decision could be made in the second half of the fiscal year ending March 31, 2021.

Finance ministry officials are said to be in talks with the country's central bank, according to one source, but the ministry and the central bank did not comment on the matter, Reuters noted.

As of May 27, US$1 was equivalent to 75.92 Indian rupees.