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Instead of opposing privatisation of govt banks, unions must focus on thrashing out a roadmap for smooth transition

Privatisation critical for cash starved public sector banks

Even as the Union United Forum of Bank Unions (UFBU), an umbrella body of nine unions, decided to call for two-day strike later in the month opposing privatisation of state-owned lenders, several employees said that the unions need to be more constructive, especially at a time when many of them are in the red.

Several mid-level to senior officials said that instead of blind opposition, managements and unions need to thrash out a roadmap along with the government chalking out a smooth transition.

The roadmap to privatization of banks needs to clearly spell out the monetary and social package needs to be prepared which will suit the employees, insiders said.

Several state owned banks are already reeling under a pile of bad assets with decelerating profit margins and cash crunch. “Amid this situation, it is quite natural that the government wants to exist the business. Strikes too have limited impact in today’s day when most banking is technology-driven,” a retired official said.

The National Organization of Bank Workers (NOBW), an affiliate of the Bharatiya Mazdoor Sangh has said that the need of the hour is to create a positive narrative while outlining the stringent measures required to protect employees’ interest.

Finance Minister Nirmala Sitharaman in the Union Budget 2021-22 announced privatization of two state owned banks and a general insurance company.

“We are trying to create awareness. The unions have always opposed every move of the government but it is time now to work in a constructive manner so that employees do not suffer,” Ashwani Rana, vice president, NOBW, told India Narrative.

A banking industry source said that public money cannot be directed towards supporting unviable banks for too long. “Bold decisions pertaining to reform measures are the need of the hour. The government is determined to move forward,” the source said.

The country’s public sector banks, barring the biggies – the State Bank of India, Bank of Baroda and Punjab National Bank among a few others have been struggling in the last few years.

Besides, the public sector banks are in acute shortage of talent.

“These banks fail to attract talent. There are no able officials. Recruitments in the country’s government banks have slowed down drastically in the last five years,” a public sector bank official said.

Meanwhile, insiders said that the Narendra Modi government, which has raised the pitch over ‘good economics is good politics’ ethos, will stick to the prescription laid down in the Union Budget. Last week Prime Minister Modi also highlighted that the government has “no business to be in business.”