The Indian banking sector, including NBFCs (non-banking financial corporations), ‘continues to be resilient… strong’, Reserve Bank of India governor Shaktikanta Das said Wednesday, in an apparent reference to concerns over lenders’ exposure to the embattled Adani Group.

Announcing monetary policy recommendations, which include a policy repo rate hike of 25 basis points, Das said domestic banks’ exposure is ‘against underlying assets, operating cash flows, (and) projects under implementation, and (is) not based on market cap’.

“The strength, size and resilience of the Indian banking system now are much stronger and larger to be affected by a case like this,” he said, although he did not name the Adani Group.

The RBI chief also stressed that appraisal methods of Indian banks had improved significantly over the past few years, and referred to steps taken by the central bank, including framing guidelines and setting up audit and risk management committees.

According to news agency PTI, Das was asked if the RBI was considering guiding domestic banks regarding exposure to Adani Group stocks in the context of rating agencies’ reports.

Opposition leaders have flagged what they say is the ‘large exposure’ of public financial bodies like the Life Insurance Corporation and the State Bank of India to Adani stocks.

This follows a report by United States-based short-seller Hindenburg Research that accused the Gautam Adani-led conglomerate of ‘brazen’ accounting fraud and pointed to large debts.

Adani company stocks plunged following the report and the flagship group lost well over $100 billion in market value, forcing the cancelling of a $2.5 billion FPO. Some of these stocks have rallied over the past few days, many on the back of loan pre-pyament notices.

The Adani Group also issued a detailed response – a 413-page statement – to the Hindenburg report, which it slammed as a ‘calculated attack’ on India’s financial institutions.

The financial furore surrounding Gautam Adani – who tumbled precipitously down a list of the world’s richest men after it broke – has also triggered a political row between the ruling Bharatiya Janata Party and the opposition; a flashpoint was Congress MP Rahul Gandhi’s speech Tuesday in the Lok Sabha, in which he alleged links between the BJP and Adani.

The government has distanced itself from the Adani controversy, pointing to regulatory bodies within the financial sector that would act against any wrong-doing by any company.

Last week union finance minister Nirmala Sitharaman referred to SBI and LIC statements and said their exposure is ‘very well within the permitted limits’. The finance minister also said both the LIC and SBI remained over profit even with the valuation (of Adani stocks) falling.