Union Finance Minister Nirmala Sitharaman on Saturday, March 20, said that the government is privatising and selling the bank to remain in business and also because she is not capable of running it efficiently.
The Finance Minister was speaking at ET Awards for Corporate Excellence, a function of Economic Times. Her statement comes at a time when the LIC employees and several Bank unions have protested the government's move to privatise various entities.
Replying to a question of Bodhisatva Ganguli, the executive editor of The Economic Times, over the privatisation of the Banks, Nirmala Sitharaman said she hopes "to engage with all those who have any hesitation on bank privatisation". She said "when it comes to privatisation" she recognises that these units which may be profit-making, loss-making, "they are in the economic activity producing a particular product that is absolutely critical for the economy per say".
"I need that activity to continue, so privatisation is not something that is going to end up selling for closure. No, I am selling for the business to continue, so that is one thing that we have to keep in mind. One principle is that I am selling it to continue in business because I can't run it efficiently and another thing is that I don't have money of that quantity that I need to invest," Sitharaman said adding that she needs to be accountable for the taxpayer's money. "So, when I privatise, I want that equity to continue with efficiency, continue with more money to come in and that could come in from the private sector."
Describing the second principle, the finance minister said, "The second principle is that I will ensure that the rights of the workers, the perks of the workers and every commitment which have been made by the government for the workers at various levels and categories are ensured."
She also said that if these two principles are there then she thinks she should be able to convince and take forward the agenda.
Earlier on March 18, a day-long strike was observed by the employees of LIC who were protesting against the Centre's decision to reduce its stake in the corporation through an initial public offering.
Prior to the strike by LIC employees, the nation witnessed a two-day strike on March 15 and 16 by the Bank unions against the government decision to privatise public sector banks.