India is looking to privatise more than half of its state-owned banks to reduce the number of government-owned lenders to just five as part of an overhaul of the banking industry.
Part of the Plan:
The first part of the plan would be to sell majority stakes in Bank of India, Central Bank of India, Indian Overseas Bank, UCO Bank, Bank of Maharashtra and Punjab & Sind Bank.
Have only 4-5 government owned banks.
At present, India has 12 state-owned banks.
Need:
The government is working on a privatisation plan to help to raise money by selling assets in non-core companies and sectors when the country is strapped for funds due to lack of economic growth caused by the corona virus pandemic.
Reserve Bank of India has recommended that India should have not more than five state-owned banks.
The government has already said that there will be no more mergers (between state-owned banks) so the only option for them is to divest stakes.
