On Tuesday, Finance Minister Nirmala Sitharaman notified Parliament that the union cabinet has not come to a specific conclusion on the proposition of privatization of two public sector banks (PSBs). The Finance Minister had declared the plan of privatizing two PSBs during her budget speech for 2021-22. In a written reply to a concern in Rajya Sabha on the privatization of two PSBs, the finance minister asserted, “Consideration of several issues about disinvestment is entrusted to the Cabinet Committee designated for this purpose. The decision by the Cabinet Committee has not been taken in this regard.”The Banking Laws (Amendment) Bill 2021 encompasses the privatization of public sector banks, which was documented for introduction in the continuous Winter session of Parliament, as the session ended on December 22. The government is not planning to introduce the Banking Laws (Amendment) Bill 2021 during the Winter session of Parliament, as it intends to have a revision of some crucial points about the whole exercise before going forward with the motion.
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Sources familiar with the advancement had implied that the recent market situation is not being detected as conducive for getting the legislation and meetings are possibly going to be held with the Reserve Bank of India (RBI) before an ultimate judgment is reached. The financial effect of the Coronavirus pandemic and the surging threat of the Omicron variant are also other crucial components that are discovered to have impacted the government’s reasoning. Moreover, officials asserted that while the original thought within the administration was to auction two PSBs to private entities by depriving its entire stakes in them, there is a chance that the government may like to keep 26 percent stake individually in these banks with itself and sell off the remaining stake to various entities.
