Pressured, RBI disowned report on bank privatisation, says Congress

New Delhi, August 20

The Congress on Saturday said the RBI had “disowned” its own research wing’s report that red-flagged privatisation of banks, and alleged that the RBI was acting under government pressure. The bank has denied the charge.

The report — A big bang approach of privatisation of public banks may do more harm than good — appeared in the RBI’s August bulletin after an analysis by the NCAER suggested to the government to sell all PSU banks, except the SBI.

Congress spokesperson Supriya Shrinate said the report clearly stated that privatisation was not the sole solution and that public sector banks were strategically important for financial inclusion and for bringing banking to the unprivileged. “Researchers are from the RBI, but their report is not of the RBI. The RBI has been pressured by to issue a clarification where it has disowned the research paper, stating these are the views of the author and not of the RBI,” Shrinate said lamenting that PSU banks had been reduced from 27 to 12 and there were plans to privatise more.