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The government is moving to retool India\u2019s banking system for the country\u2019s next phase of growth, with Union Finance Minister\u00a0Nirmala Sitharaman\u00a0announcing that a high-level committee will soon be set up to review the sector and recommend reforms aimed at creating large, globally competitive lenders.\u00a0<\/p>
In an interview with\u00a0PTI Videos<\/em>, Sitharaman said the proposed panel will focus squarely on preparing banks to meet the funding needs of\u00a0Viksit Bharat, India\u2019s vision of becoming a developed nation. \u201cWe want the committee to tell us what kind of things we need to do so that banking is made available for funding Viksit Bharat,” she said.\u00a0<\/p> Asked whether the exercise could lead to further mergers among public sector banks, the finance minister cautioned against reducing the mandate to consolidation alone. \u201cIt is for India\u2019s banking sector to be made big enough, big enough in the sense, made or primed to take care of Viksit Bharat funding. You have to reach Viksit Bharat destination\u2026it needs money, it needs financing, it needs credit, it needs banking facility to reach the common man,” she said.\u00a0<\/p> On the timeline, Sitharaman signalled urgency, saying, \u201cWe will do it at the earliest.”\u00a0<\/p> The plan was formally unveiled in the\u00a0Union Budget\u00a0on February 1. In her Budget speech, Sitharaman had said, \u201cI propose setting up a \u2018High Level Committee on Banking for Viksit Bharat\u2019 to comprehensively review the sector and align it with India\u2019s next phase of growth, while safeguarding financial stability, inclusion and consumer protection.”\u00a0<\/p> Alongside banking reforms, the Budget also flagged steps to achieve greater scale and efficiency in public sector non-banking financial companies. This includes the proposed restructuring of\u00a0Power Finance Corporation\u00a0(PFC) and\u00a0Rural Electrification Corporation\u00a0(REC). Responding to questions on whether a merger between the two is likely, Sitharaman said, \u201cA lot of work has happened in the ministry concerned. They have come up with this expectation. Let\u2019s see how they play it out.”\u00a0<\/p> REC is a subsidiary of PFC, with both institutions playing a critical role in financing power generation, transmission and distribution projects. The relationship was cemented in March 2019, when PFC acquired a majority stake in REC by transferring Rs 14,500 crore to the government. The transaction involved the purchase of 103.94 crore shares, or a 52.63 per cent stake, at Rs 139.50 per share, following in-principle approval from the Cabinet Committee on Economic Affairs.\u00a0<\/p> Both PFC and REC are Navratna central public sector enterprises, and the acquisition was positioned as a step toward consolidating entities operating in the same space. Momentum on that front picked up last week, when the PFC board gave in-principle approval for the merger of the non-banking finance company REC Limited with itself.\u00a0<\/p> The board\u2019s decision came after the Budget announcement, underlining the government\u2019s broader push to create institutions with the scale and strength needed to support India\u2019s long-term development ambitions.\u00a0<\/p> <\/div> India banking reforms, Viksit Bharat banking, high-level committee on banking, Nirmala Sitharaman interview, Union Budget banking proposals, public sector banks reforms, PFC REC merger, power sector NBFC restructuring, Indian banking sector review, globally competitive Indian banks#Funding #Viksit #Bharat #Govt #set #highlevel #panel #prepare #banks #bigticket #growth1770600018<\/p> ","protected":false},"excerpt":{"rendered":" The government is moving to retool India\u2019s banking system for the country\u2019s next phase of growth, with Union Finance Minister\u00a0Nirmala Sitharaman\u00a0announcing that a high-level committee will soon be set up to review the sector and recommend reforms aimed at creating large, globally competitive lenders.\u00a0 In an interview with\u00a0PTI Videos, Sitharaman said the proposed panel will […]<\/p>\n","protected":false},"author":1,"featured_media":3097,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37],"tags":[10177,593,1436,2781,10174,1554,446,10167,10175,10165,10173,10168,10176,10171,10172,965,10170,544,10169,7378,10166],"class_list":["post-3096","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-content-marketing","tag-banks","tag-bharat","tag-bigticket","tag-funding","tag-globally-competitive-indian-banks","tag-govt","tag-growth","tag-high-level-committee-on-banking","tag-highlevel","tag-india-banking-reforms","tag-indian-banking-sector-review","tag-nirmala-sitharaman-interview","tag-panel","tag-pfc-rec-merger","tag-power-sector-nbfc-restructuring","tag-prepare","tag-public-sector-banks-reforms","tag-set","tag-union-budget-banking-proposals","tag-viksit","tag-viksit-bharat-banking"],"acf":[],"_links":{"self":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/posts\/3096","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3096"}],"version-history":[{"count":0,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/posts\/3096\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=\/wp\/v2\/media\/3097"}],"wp:attachment":[{"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3096"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3096"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/longzhuplatform.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3096"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}