FM working with RBI on bank privatisation plan

Finance Minister Nirmala Sitharaman said the country required at least 20 institutions of the size of the nation’s largest lender, State Bank of India (SBI), to be able to meet its aspirations.

Sitharaman said the government would work with the Reserve Bank for execution of the bank privatization plan announced in the Budget, but declined to comment on any specific details about which will be candidate chosen for privatization. In the budget, Sitharaman had announced the privatization of two banks as part of its disinvestment plan. Bank unions have opposed the move. “The details are being worked out. I have made the announcement but we are working together with the RBI,” she said, when asked about the proposal.

She rejected the opposition’s charge of “selling family assets” through the budget stress on privatization, terming it as a “lazy allegation”. “It is not what the opposition says about selling family silver, it’s not at all,” she said, addressing a meeting of business people in Mumbai. “Family silver should be strengthened, it should be our takat (strength),” she said.

All the previous governments have done disinvestment, and the current regime has formulated a clear policy on which companies to be divested, she said.

Sitharaman said despite reforms of the past, “socialist baggage” hindered business, and many state-run firms had been lacking professional expertise to grow or were present in sectors which were not strategically important.