The survey, by the Federation of Indian Chambers of Commerce & Industry (Ficci) and the Indian Banks' Association (IBA), also said bankers recommended that the government should allow a full tax deduction on the NPA provisioning as against the cap of 5 per cent of taxable income.
"The bankers have suggested specific measures that may be announced in the upcoming Union Budget to facilitate credit growth and investment pick-up in the economy. They recommend accelerated investments in infrastructure sector as well as interest subvention for investments in long gestation infrastructure projects," the survey said.
According to it, most of the responding banks have suggested a reduction in corporate tax rate from 30 per cent to 25 per cent, lowering of MAT rate to 15 per cent and enhancing tax deductions and exemptions for individuals.
"This should boost credit demand at both corporate and retail level," it said.
The sixth round of the survey was carried out for the period July to December 2017. A total of 19 public sector, private sector and foreign banks participated in the survey. These banks together represent 59 per cent of the banking industry, as classified by asset size.
Bank credit has been growing at a slow pace in the economy.
The survey findings reveal that banking sector performance during the July-December 2017 period remains more or less similar to the previous six months on the parameters studied.
"Nearly 67 per cent of the participating banks have maintained their credit standards for large as well as small enterprises. Out of the few who have tightened credit for large enterprises have cited a rise in NPAs or a risk of the asset turning into NPA as the main reason for their action," the survey said.
The share of corporate to retail loans also remains the same at 56:44 as noted in the previous round of the survey.
"58 per cent of the respondent banks reported a rise in NPAs, significantly lower than 80 per cent reporting so in the previous round of the survey indicating possible stability in credit environment," the survey revealed.
Following the repo rate reduction of 25 basis points by the Reserve Bank of India in August 2017, almost 84 per cent of the respondents have reduced their MCLR (marginal cost based lending rate).
Banks have welcomed the recapitalisation plan of Rs 2.11 trillion for public sector banks and believe that it will help in boosting credit growth and subsequently growth recovery of the economy.
A large number of banks have also welcomed the RBI's move of constituting a high-level task force for setting up a public credit registry, the survey added.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)