
The Congress has strongly opposed any attempt to decrease the Union government’s stake in 12 public sector banks to less than 51 percent. This resistance is asserted to be both within Parliament and outside. Today (19th July) in 1969, banks were nationalized in public interest. Indira Gandhi had nationalized the banks to provide banking facility to the citizens of India. But now, the Modi government is planning to privatize public sector banks. As per the plans, only 4 PSU Banks will remain and rest all will be privatized.
Historical Context and Significance of Bank Nationalization
Congress general secretary Jairam Ramesh highlighted the historical significance of bank nationalization, citing the decisive move made by then Prime Minister Indira Gandhi 55 years ago to nationalize 14 banks. Ramesh emphasized the impact of this event on India’s economic history, drawing attention to archival material and memoirs by key figures such as PN Haksar, DN Ghosh, and IG Patel.
Impact of Bank Nationalization and Public Sector Banking Mergers
Ramesh emphasized the profound impacts of bank nationalization on lending for agriculture, rural development, and other priority sectors of the economy. Additionally, he pointed out that public sector institutions have provided valuable service during global financial crises and have developed a strong pool of managerial expertise.
The Congress leader also discussed the mergers that have taken place in the public sector banking industry over the past seven years. He specifically mentioned the mergers involving United Bank of India, Oriental Bank of Commerce, Punjab National Bank, Syndicate Bank, Canara Bank, Allahabad Bank, Indian Bank, Union Bank of India, Andhra Bank, Corporation Bank, Vijaya Bank, Dena Bank, and Bank of Baroda. Ramesh highlighted the challenges posed by these mergers and underscored the importance of maintaining the Union government’s share above 51 percent.
Resistance to Dilution of Union Government’s Position
Ramesh reiterated the party’s strong opposition to any move that would dilute the Union government’s position in the 12 public sector banks, emphasizing that such attempts will continue to be forcefully resisted both within Parliament and outside.
Evolution of Political Stances on Bank Nationalization
Ramesh noted the initial opposition to bank nationalization by political parties like the Bharatiya Jan Sangh, highlighting how the stance evolved within five months to include public demands for the nationalization of foreign banks as well.