The Indian Government is planning to reduce the number of state-owned banks to five rather than twelve.
The report states that the amount of state-owned banks should be reduced to only five by selling the majority stakes in Bank of India, Central Bank of India, Indian Overseas Bank, UCO Bank, Bank of Maharashtra, and Punjab & Sind Bank.
The Ministry of Finance has not commented on the subject as laid down in the paper.
During a time when the economy is under pressure due to the continuing COVID-19 pandemic, the government attempts to gain revenue by selling commodities to non-core companies and sectors.
A number of government committees and the Indian Reserve Bank (RBI) proposed that India should restrict its state-owned banks to five.
In 2019, Ten state-owned banks were merged into Four but the government official told: “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.”