Union Finance Minister Nirmala Sitharaman on Tuesday tried to assuage the fears of bank employees, who have launched a countrywide stir against the Centre’s policies. The minister assured them that not all state-owned banks will be privatised under the central government’s disinvestment plan.
Addressing a Cabinet briefing, Sitharaman said that the public sector enterprise policy “very clearly” stated that the Centre will continue operating public sector banks. “So, just to quickly say that all private banks will be sold off, is not right,” the finance minister said.
As for the banks that are likely to get privatised, Sitharaman said the government will ensure that the interests of every employee was “absolutely protected”. “Whether its their salaries, whether its their pension, it will all be taken care of,” she added. “Interest of workers will be protected at all cost.”
Her assurances came on the second day of a two-day strike called by the United Forum of Bank Unions – an umbrella body of nine unions – to protest against the proposed privatisation of two state-owned lenders. As many as 10 lakh bank employees participated in the protest, which brought several banking operations to a standstill in different parts of the country.
The government has already privatised IDBI Bank by selling its majority stake in the lender to LIC in 2019. Sitharaman had announced the privatisation of two more public sector banks as part of its disinvestment plan in the Union Budget presented last month.
The bank unions demand that the government should to take back the privatisation and merger plans, as they fear it would lead to job losses. They say the proposals were “retrograde banking reforms” that would do more harm than good.
Sitharaman, however, sought to downplay these fears, saying the government was equally concerned about the future of employees. “We are not selling them [banks] off because we are not worried,” she told reporters on Tuesday. “We are doing it because we want to make financial institutions better equipped and more sustainable.”
Giving the example of the State Bank of India, Sitharaman said the government was focussing on amalgamating banks so that they were “big enough” to be able to “meet the aspiration needs of the country”. “Today we have quite a few number of banks and they have a very big role to play,” she added. “But we need banks which are going to be able to scale up.”
At the same time, the finance minister said that the government was “very conscious” of its duties to ensure the workers’ interests are protected. “So, it is wrong to assume that it [state-owned banks] is going to be closed, people are going to be removed,” she added. “All these factors have been kept in mind.”