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Withdraw proposed Bill on PSB privatisation, CPI urges govt

Even as the government moves towards ‘The Banking Laws (Amendments) Bill 2021’ in the ensuing Winter Session of the Parliament, which is commencing on November 29 so as to enable it to privatise public sector banks (PSBs) as proposed in the Union Budget 2021-22, the same has been objected by the Communist Party of India.

Withdraw proposed Bill on PSB privatisation, CPI urges govt
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Mumbai: Even as the government moves towards 'The Banking Laws (Amendments) Bill 2021' in the ensuing Winter Session of the Parliament, which is commencing on November 29 so as to enable it to privatise public sector banks (PSBs) as proposed in the Union Budget 2021-22, the same has been objected by the Communist Party of India.

In a letter, directed to Prime Minister Narendra Modi, the Communist Party of India (CPI) has said that PSBs act as catalysts in the economic development of our nation in general and particularly for the underprivileged sections of the society and backward regions of the country. Nationalised banks have played a major role in the development of agriculture, small trade, small business, SSI, transport and in upliftment of weaker sections of the society. In the process, common people were brought under the orbits of the banking and thereby development. Way back in 2008 when the world economy was plunged into a deep financial crisis and meltdown, it was PSBs, which helped Indian economy to sustain. "The only issue being confronted with the PSBs was that of huge Non-Performing Assets (NPAs) in which the major share was that of big corporates. Successive governments have taken initiatives such as Debt Recovery Tribunals, SARFESI Act, and IBC, but they have not yielded the desired results and therefore ultimately banks were forced to write off those loans resulting into huge losses. This shows that it is not the nationalisation of banks, which has failed but it is the wilful default of the corporate and big business houses, which have dragged the banks into this crisis," says D Raja, CPI general secretary.

As against this, he goes on, time and again public sector banks have been used to bail out ailing private sector ones such as Global Trust Bank, United Western Bank, and Bank of Karad. In the recent past, it was Yes Bank, which was bailed out by public sector SBI. Private sector's largest NBFC, IL&FS, was bailed out again by public sector SBI and LIC. In the recent past private sector RBL Bank, Bandhan Bank and four small finance banks have posted losses. RBI has cancelled the licence of private sector Local Area Bank, namely Subhadra Local Area Bank. Thus, common people have become scared of private sector banks since they expose their hard-earned savings. The present government headed by you claims that it is implementing various social sector loans, pension and insurance schemes such as Jan Dhan, MUDRA for unemployed youth, Swadhan for street vendors, Pradhan Mantri Awas Yojana, Pradhan Mantri Jivan Jyoti Yojana, Pradhan Mantri Jivan Suraksha Yojana and Direct Benefit Transfer Schemes such as

Pradhan Mantri Garib Kalyan Yojana, Pradhan Mantri Kisan Kalyan Yojana, and Atal Pension Yojana, for the underprivileged sections of the society in which the major share is that of PSBs. During the pandemic period, it is the public sector banks which have been giving uninterrupted customer services.

"We therefore are of the view that privatisation of public sector banks will jeopardise the interests of the common people and backward regions of the country. We are opposed to any such retrograde move," Raja said. The CPI has requested the government to revisit the decision of privatisation of PSBs and to withdraw the proposed Bill in the interest of the common people and nation.

Kumud Das
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