NEW DELHI: Taking a swipe at the Modi government’s economic policy, the Congress on Sunday said foreign firms gradually being allowed to acquire Indian banks was “imprudent” as it poses substantial risks. The grand old party also reminded the BJP that the Jan Sangh had criticized then Prime Minister Indira Gandhi for not nationalizing foreign banks in July 1969.
Congress general secretary in-charge communicaions Jairam Ramesh’s assertion came after Emirates NBD Bank, the second largest in the UAE, expressed interest in acquiring a majority 60% stake in RBL Bank for Rs 26,853 crore — the biggest ever financial sector deal in value terms.
“Foreign firms are gradually being allowed to acquire Indian banks. These imprudent moves pose substantial risks,” Ramesh said on X.
First, Laxmi Vilas Bank was acquired by Singapore’s DBS Group and the Catholic Syrian Bank was acquired by Canada’s Fairfax, he said.
“Third, Japan’s Sumitomo Mitsui Banking Corporation took over Yes Bank. Now comes news that Dubai’s Emirates NBD is acquiring RBL Bank,” the Congress leader said.
“And, of course, India’s first full privatization of a public sector bank is expected to be completed in this financial year. This is the sale of IDBI Bank,” he added.
Just as a matter of historical interest, Ramesh said, the Jan Sangh had criticised Indira Gandhi for not nationalising foreign banks in July 1969.
He also shared a news report dated December 28, 1969, after the Jan Sangh’s meeting in Patna the previous day in which it had called for the takeover of all big foreign firms.
The acquisition plan of Emirates NBD Bank to hold a controlling stake in RBL Bank through an infusion of approximately USD 3 billion (about Rs 26,850 crore) marks the largest-ever foreign direct investment in India’s financial services sector.