Whether Govt is planning to privatise some PSBs?

In August 2019, the Centre had announced a third round of PSB consolidation, reducing the number of PSBs to 12 from 18.

But Indian Overseas Bank, UCO Bank, Bank of Maharashtra and Punjab and Sind Bank have been left out of any consolidation plan so far, and Sitharaman had said then that they would continue to function as earlier as they have strong regional focus.

Sitharaman had announced the new privatisation policy on May 17. “In the notified strategic sectors, there would be only one to four public sector enterprises. They will be merged or brought together, so there won’t be mushrooming of the public sector,” she said, while adding that the private sector could come in strategic sectors.

“Banking is an obvious candidate to be designated as a strategic sector. There have been discussions on privatising the PSBs that are not part of our consolidation plans,” the official said, adding the long-term plan will involve having four mega-public sector banks (PSBs) through further mergers or privatisation.

Since the announcement of the new policy, neither the FM nor anyone else in the government has given any time limit to the new privatisation policy, but the details are expected soon. It is said that once a sector is designated “strategic” or “non-strategic”, there is no fixed timeline in when the government will reduce its presence. In non-strategic sectors, the government plans to exit completely.