Top economists advice Govt to privatise all public sector banks except SBI

All the public sector banks, except the State Bank of India should be privatised. The former Vice Chairman of National Institution for Transforming India (NITI) Aayog and Professor of Columbia University, Arvind Panagariya, and Director General of National Council of Applied Economic Research (NCAER) Poonam Gupta, along with member of the Council suggested while advising the Prime Minister on economic matters.

Both Gupta and Panagariya, while presenting policy papers in the India Policy Forum stated that privatisation of public sector banks is in the interest of all.

With most banks going into the private sector, the pressure on the Reserve Bank of India will also increase to streamline the entire process, rules and laws, so that it can yield good results.

According to the report all public sector banks including State Bank of India should be privatised. However, since the government would not want to do without any government bank, the target at present should be to privatise all other banks except SBI. If the environment looks favourable after a few years, then SBI should also be privatised.

Significantly, Finance Minister Nirmala Sitharaman, while presenting the budget for the current financial year, announced the privatisation of two public sector banks along with IDBI Bank in the financial year 2022.

Apart from this, NITI Aayog has also shortlisted two Public Sector Undertaking banks for privatisation. Along with this, the Finance Minister also said that an insurance company would be sold in the current financial year.

The government has already clarified its stand on privatisation despite a series of protests. Where both the economists have shown their full support in the privatisation of banks, on the other hand, government employees are also continuously on strike against it.

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