Not even one employee will lose job due to mergers of Public Sector Banks: FM Nirmala Sitharaman
Chennai, Sep 01: Putting to rest the rumours that the merger of Public Sector banks into bigger entities would lead to job losses, Finance Minister Nirmala Sitharaman on Sunday assured that not a single employee of these banks would lose the job.
Sitharaman on Friday unveiled a plan to merge 10 public sector banks into four big banks. After this is fully implemented, the total number of Public Sector Banks in the country will come down to 12 from 27 banks in 2017. This decision was taken with the aim to create fewer and stronger global-sized lenders.
Finance Minister on the merger of PSU Banks:
After the Union Government announced this move, the All India Bank Employees Union said the amalgamation would lead to the closure of banks besides job losses.
Sitharaman today allayed fears of job losses following the proposed and said not even one employee shall be removed following the amalgamation.
"Absolutely, ill-informed. I want to assure every union in every one of these banks to please recall what I have said last Friday. When we spoke about the amalgamation of banks I have very clearly underlined the fact that there shall not be one employee removed. Not at all", she told reporters in the national capital.
Sitharaman further said there would be no closure of banks. "No banks are being asked to do anything different from what they were doing. In fact, we are giving them more capital to do what they were doing," she said.
Nirmala Sitharaman on GDP growth:
The Central Statistical Office yesterday said that India's quarterly GDP has come down to 5 per cent as compared to 5.8 per cent in the last quarter of the financial year. The figure stood at 7.8 per cent in the same quarter of the previous financial year. The manufacturing sector and private consumption are being blamed for the slump.
"I am meeting industries and taking their inputs, suggestions on what they would want and expect from government, I am responding to them.I have already done this twice.I will do it more no. of times," the Finance Minister said when asked economic slowdown.
Cutting down FY20 GDP growth to 6.7 per cent (six-year low) from its earlier forecast of 7.3 per cent, India Ratings and Research (Ind-Ra) on August 28 said that the current fiscal would be the third consecutive year of subdued growth. It attributed the lacklustre performance primarily to a slowdown in consumption demand, delayed monsoon, the decline in manufacturing and rising global trade tensions affecting exports.
When asked about lowering GST rates, Finance Minister Sitharaman said GST rate cut was not in her hands and it was the GST Council that would take a decision on the same.
Sitharaman on Manmohan Singh:
Earlier on Sunday, former prime minister Manmohan Singh slammed the government for the slowdown, saying "all-round mismanagement" had led to the current state of the economy. He also urged the government to "put aside vendetta politics, and reach out to all sane voices to steer our economy out of a man-made crisis."
The Finance Minister, when asked to comment on Singh's statement, refused to respond.
"Is Dr Manmohan Singh saying that 'instead of indulging in political vendetta they should consult sane voices?' Has he said that? All right, thank you, I will take his statement on it. That is my answer," Sitharaman said.
On Friday, Sitharaman announced the consolidation of 10 state-run lenders into four bigger banks. Currently, there are 18 public sector lenders, compared to 27 in 2017. There will be only 12 after the mergers. Punjab National Bank, Oriental Bank of Commerce and United Bank of India will combine to form the nation's second-largest lender. State Bank of India (SBI) is the country's largest lender.
The second merger will be between Canara Bank and Syndicate Bank, which will make it the fourth-largest public sector lender. Union Bank of India will amalgamate with Andhra Bank and Corporation Bank and Indian Bank will merge with Allahabad Bank.
Gross domestic product (GDP) growth decelerated to the slowest pace in 25 quarters in the three months ended June 30 as a downturn in household consumption took its toll on key sectors, deepening concern about the anaemic state of the economy.