NITI Aayog Refutes Reports Of Privatisation Of SBI, PNB & Others

Though the policy think tank had indeed released a list of banking institutions for privatisation in March 2021, it had excluded PSBs such as SBI, PNB, Union Bank, Canara Bank, Indian Bank and Bank of Baroda from the mix

By Soumya Duggal • Jan 1, 2023 Originally published Jan 1, 2023

NITI Aayog

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NITI Aayog, the Indian government's apex public policy think tank, has discredited recent media reports suggesting that it had circulated a list of the country's largest public sector banks (PSBs), such as the State Bank of India (SBI), Punjab National Bank (PNB) and Bank of Baroda, among others, for being privatised.

"A fictitious message is being circulated in media regarding list shared by NITI Aayog on privatization of public sector banks. It is hereby informed that no such list as mentioned has been shared by NITI Aayog in any form," said NITI Aayog in a statement on Friday.

With the Union Budget 2023 to be presented in just a few weeks, the inaccurate reports naturally drew in many a reaction on micro-blogging website Twitter, with one user writing, "This govt is surely going bankrupt. That only could be the reason for selling our cash cows. They have diluted PSB share over the years and now selling the whole lot of companies. Crazy." Another user commented, "How much damage is @NITIAayog going to be allowed to do?"

While the policy think tank has issued clarification on the matter, it had indeed released a list of banking institutions for privatisation in March 2021 but had excluded SBI, PNB, Union Bank, Canara Bank, Indian Bank and Bank of Baroda from the mix.

According to the government's latest statement on the matter, made in December 2022, it will take a view on the privatisation of PSBs after consultation with the concerned department and regulator. "Consideration of issues related to disinvestment and decision on selection, terms and conditions, etc., in case of strategic sale is entrusted to the Cabinet committee designated for this purpose under the Government of India (Transaction of Business) Rules, 1961," said minister of state for finance Bhagwat Karad in a written reply to the Lok Sabha.

The government's intent to take up privatisation of two PSBs and approval of a policy of strategic disinvestment of public sector enterprises (PSEs) was announced in the Union Budget FY22, he said. According to Karad, the objectives of the policy include enabling growth of public sector enterprises through infusion of private capital, thereby contributing to economic growth and new jobs, and financing of social sector and development programmes of the government.

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