Bank Strike: Why PSU Banks Are Going On A Nationwide Strike This Week

The strike, scheduled on December 16 and 17, is against the Banking Laws (Amendment) Bill, 2021 which would be a step towards the government’s plan to privatise the public sector banks.

Outlook Web Desk

Updated on: 14 December 2021 9:39 am

Bank Strike: Why PSU Banks Are Going On A Nationwide Strike This Week

Starting Thursday, the public sector banks (PSBs) across the country are set to go on a two-day strike called by the United Forum of Bank Unions (UFBU) to protest the government’s plan to privatise the public sector banks.

Finance Minister Nirmala Sitharaman had announced in this year’s Union Budget that two PSBs were going to be privatised during the current fiscal as part of the government’s Rs 1.75 lakh crore disinvestment target. The strike, scheduled on December 16 and 17, is against the Banking Laws (Amendment) Bill, 2021 which would be a step in that direction.

Media reports state that the Bill, which will be taken up in the ongoing Winter Session of the Parliament, is expected to bring down the minimum government holding in the PSBs from 51 per cent to 26 per cent. It is one of the 26 Bills that are scheduled to be introduced during this session.

"It is also a matter of reality that time and again public sector banks have been used to bail out ailing private sector banks such as Global Trust Bank, United Western Bank, Bank of Karad, etc. In the recent past, it was Yes Bank, which was bailed out by public
sector SBI. Private sector's largest NBFC, IL&FS, was bailed out again by public sector SBI and LIC,” UFBU Convener B Rambabu told PTI.

PSBs have lost nearly Rs 2.85 lakh crore due to loan defaults of 13 corporates even as the banks are used to aid the ailing financial institutions like Yes Bank and IL&FS, the UFBU alleged on Monday. According to the statistics provided by the UFBU, the 13 companies’ dues amounted to Rs 4,86,800 crore and were waived off at Rs 1,61,820, which resulted in a loss of Rs 2,84,980 crore.

UFBU added that the operating profits of the PSBs are in a healthy condition but the banks' primary issue was massive non-performing assets (NPAs) with big corporations accounting for the majority of them.

Rambabu pointed out that PSBs participate in the majority of the government schemes and programmes like Swadhan for street vendors, Pradhan Mantri Awas Yojana, Jan Dhan, MUDRA for unemployed youth, and Pradhan Mantri Jivan Jyoti Yojana. The privatisation of PSBs will be disadvantageous to common people and the backward regions of the country, he added. The UFBU, therefore, believes that this move will be detrimental to the interests of the nation and its people, Rambabu told the news agency.

The UFBU’s members and officers are ready to go to any extent, including an indefinite strike, in case the government goes forward with the Bill in the Parliament, Rambabu told news agency UNI.