India's banking sector demonstrated significant asset quality improvement in fiscal year 2024-25, according to an RBI report. Gross NPAs for scheduled commercial banks fell to Rs 4.31 lakh crore, with the gross NPA ratio decreasing to 2.2 percent. This improvement was driven by recoveries, upgrades, and write-offs totaling Rs 2.75 lakh crore, exceeding the Rs 2.26 lakh crore in fresh NPAs added. Public sector banks saw a notable reduction in their gross NPA ratio to 2.6 percent.