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'No job loss or takeover in banking sector reforms'
Wednesday, 19 January 2005, 20:30 IST
NEW DELHI: The government Wednesday assured Left parties it would come up with a roadmap for reforms in the banking sector that would prevent retrenchment or hostile takeovers.
At a breakfast meeting with Left leaders at Prime Minister Manmohan Singh's 7, Race Course Road residence, Finance Minister P. Chidambaram also pledged to address concerns about foreign equity in private banks.
"Weak public sector banks will be consolidated and strengthened, but they must be protected so that they do not collapse," Chidambaram told reporters after the meeting, adding that the branch expansion programme would continue.
Manmohan Singh and Congress president Sonia Gandhi were also present in the 90-minute interaction. Another meeting is likely Feb 1 or 2 to discuss budget proposals.
Chidambaram reportedly told Left leaders that consolidation of banks would not mean loss of jobs or retrenchment.
He further said he had informed the meeting that inflation had come down to 5.7 percent on Jan 1, from previous year's 6.4 percent.
"There was general satisfaction at that," he said. "But we must move ahead cautiously as pressures are still there."
Chidambaram said the meeting had no specific agenda and a general exchange of views had transpired on reforms in the banking sector besides other key economic issues.
Responding to a query by Communist Party of India-Marxist (CPI-M) leader Sitaram Yechury, he also asserted that the rural credit target of 
1,000 billion would be exceeded.
A Left leader present at the meeting said the finance minister had assured that public sector banks would not be privatised and rural credit would not be hampered.
"It was discussed that if private banks need to be strengthened, then some foreign investment can be allowed but there should be proper guidelines including seeking permission from the Reserve Bank of India," said the senior leader.
Source: IANS
1,000 billion would be exceeded.
A Left leader present at the meeting said the finance minister had assured that public sector banks would not be privatised and rural credit would not be hampered.
"It was discussed that if private banks need to be strengthened, then some foreign investment can be allowed but there should be proper guidelines including seeking permission from the Reserve Bank of India," said the senior leader.
Source: IANS