India's Finance Minister Nirmala Sitharaman (C) leaves the Finance Ministry to present the annual budget in parliament in New Delhi on February 1, 2021 (File)
India's Finance Minister Nirmala Sitharaman (C) leaves the Finance Ministry to present the annual budget in parliament in New Delhi on February 1, 2021 (File)
(Photo by Sajjad HUSSAIN / AFP)

Public sector banks (PSBs) namely Punjab National Bank (PNB), Union Bank, Canara Bank, Indian Bank, Bank of Baroda and State Bank of India that were part of consolidation, will not be included for privatisation (at least in the first round). According to an ET report, the Niti Aayog has kept public sector banks (PSBs) that were part of the last round of consolidation and State Bank India out of the privatisation plan.

The government will soon take a call on the two banks and one general insurer that will be taken up for privatisation in the next fiscal year.

“PSBs that were part of the consolidation exercise have been kept out,” the report quoted a government official. In August 2019, the government had undertaken a massive consolidation exercise merging 10 PSBs into four. Now, there are around 12 PSBs as against the earlier figure of 27 PSBs.

The Niti Aayog’s recommendation to exclude six banks, which is still in the process of consolidation, is in line with the finance ministry’s plan.

In addition, Indian Overseas Bank, Central Bank of India and UCO Bank are under the prompt corrective action framework of the Reserve Bank of India. This leaves only Punjab & Sind Bank, Bank of Maharashtra, Central and Bank of India to be privatised.

Finance minister Nirmala Sitharaman had in her budget speech announced the government’s intent to privatise two PSBs and one general insurer in the next fiscal year. The government has set a disinvestment target of Rs 1.75 lakh crore for FY22.

(To receive our E-paper on whatsapp daily, please click here. We permit sharing of the paper's PDF on WhatsApp and other social media platforms.)

Free Press Journal

www.freepressjournal.in