New Delhi: The government has started preparations for the privatization of two public sector banks. The Central Government is preparing to introduce the Banking Laws (Amendment) Bill 2021 in the winter session of Parliament starting on Monday to ease the way for privatization of two public sector banks.
Target to raise Rs 1.75 lakh crore from disinvestment
Finance Minister Nirmala Sitharaman, while presenting the budget for 2021-22 in February this year, announced the privatization of two public sector banks (PSBs) under the disinvestment program. A target has been set to raise Rs 1.75 lakh crore from disinvestment in the current financial year.
Sources said the minimum government stake in PSBs is likely to be reduced from 51 percent to 26 percent through the Banking Laws (Amendment) Bill, 2021, to be introduced during the session. However, he said that the final decision regarding the timing of introducing this bill would be taken by the cabinet.
Bank officials will protest against the privatization of banks
At the same time, the All India Bank Officers’ Confederation (AIBOC) has announced a protest in Delhi during the winter session of Parliament against the privatization plan of public sector banks. Announcing the protest, AIBOC general secretary Soumya Dutta had said that the government may introduce a bill for privatization of banks in the winter session of Parliament beginning November 29.
Dutta had said that there was no economic basis behind this move of the government, it was purely a political decision taken to hand over the bank to the ‘capitalists’. Privatization of public sector banks will affect the priority sectors of the economy and impact the flow of credit to SHGs.