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ALL INDIA BANK EMPLOYEES’ ASSOCIATION
Central Office: “PRABHAT NIVAS” Regn. No.2037
AIBEA CIRCULAR No. 30/46/2026/79 DT. 31-10-2026
To Office Bearers, State Federations and
All India Bankwise Federations, All Unions
Dear Comrades,
Government constitutes High Level Committee
on Banking for Viksit Bharat to review India’s banking sector
They are on their job. Let us be ready
The Government of India has constituted a High-Level Committee on Banking for Viksit Bharat to undertake a review of India’s banking sector and recommend structural, institutional, regulatory and legislative reforms necessary to make it globally competitive, financially inclusive, and resilient for Viksit Bharat, 2047.
Members of the Committee are:
- Shri Suresh N. Patel, former Central Vigilance Commissioner – Chairman
- Shri Shirish Chandra Murmu (Dy. Governor, Reserve Bank of India)
- Smt. Padmaja Chunduru (Former MD & CEO, Indian Bank)
- Shri N S Vishwanathan (Former Dy. Governor, Reserve Bank of India)
- Joint Secretary (Bkg), Dept of Financial Services – Member Secretary
The tenure of the Committee shall be six months.
The Terms of Reference of the Committee are as follows:
- Assess the present banking practices and prudential norms, identifying global best practices, and adapt them suitably for the Indian banking system, while also providing a roadmap for creating globally competitive banks.
- Review the existing regulatory and legal frameworks for banks, including Regional Rural Banks and Cooperative Banks, and suggest reforms to bring in efficiency and enable ease of doing banking for Viksit Bharat.
- Undertake assessment of the long-term capital requirements for banks, including Development Financial Institutions and Non-Banking Financial Companies, with recommendations on funding sources and enabling mechanisms to support credit growth.
- Examine differences in cost of capital for business, and suggest policy options to boost private investment for sustainable growth.
- Prepare a roadmap for AI and digital innovation in banking institutions, while providing for safeguards against cyber risks. Further, to suggest a strategy for talent acquisition and capacity building to ensure a future-ready workforce for the banking sector.
- Review the Priority Sector Lending framework and Lead Bank Scheme to assess their relevance, effectiveness, and coordination in promoting inclusive, balanced, and data-driven credit delivery aligned with evolving economic priorities and financial inclusion goals.
- Make recommendations on any other matter referred to the Committee by the Government of India.
All of us are aware that 14 major Private Banks owned by various powerful industrial and business houses like Tatas and Birlas were nationalised by the Government in 1969 and further 6 Banks in 1980 due to the prolonged struggles of AIBEA. Since then, there has been a total transformation of the Banks from Class Banking to Mass Banking institutions.
Banks have become the repository of people’s money and depository of the hard-earned savings of the masses of the people. Public Sector Banks have become the reservoir of public savings. Banking services are made available to all the citizens of our country. Branches have been opened in thousands of rural areas and remote villages. AIBEA fought against the ills of bank credit. Neglected economic sectors became the priority sector. Public Sector Banks became the backbone of our country’s economic development.
Instead of consolidating the gains of nationalisation and strengthening the PSBs, in 1991, under the policy of economic reforms and liberalization, public sector banks became the target of reform policies aimed at liberalisation and privatisation. For the past 35 years, under successive Government, there are attempts to push through this agenda. To begin with, the law was amended to sell the shares of PSBs upto 49%. This was opposed by AIBEA and thus the speed of selling the shares was slowed down.
In 2000, the then BJP’s Vajpayee Government introduced a Bill in the Parliament to reduce Government’s share capital in PSBs to 33% and to sell 67% of share to private hands. AIBEA organised strike and secured broad political support. Thus, this Bill was shelved.
But the agenda has been kept alive. Government has appointed so many Committees to proceed with their Reforms Agenda.
Liberalisation and Reforms Era (1991 onwards)
· NARASIMHAM COMMITTEE-I (1991) :
· NARASIMHAM COMMITTEE-II (1997-98):
· VERMA COMMITTEE (1999)
· K.V. KAMATH COMMITTEE REPORT (1999)
· BANK PRIVATISATION BILL 2000 – introduced in Parliament by BJP Government.
· TARAPORE COMMITTEE (2006)
· RAGHURAM RAJAN COMMITTEE (2007)
· ANWARUL HODA COMMITTEE (2008)
· HIGH POWER EXPERT COMMITTEE (2007)
· PLANNING COMMISSION RECOMMENDS PRIVATISATION OF BANKS UNDER 12TH FIVE YEAR PLAN
· OECD REPORT ( 2011)
· OECD REPORT (2014)
· RBI DISCUSSION PAPER ON BANKING STRUCTURE (2013)
· NACHIKET MOR COMMITTEE (2014)
· P J NAYAK COMMITTEE (2014)
· INDRADHANUSH (2015)
· GYAN SANGAM I (2015)
· GYAN SANGAM II (2016)
· FINANCIAL RESOLUTION & DEPOSIT INSURANCE – FRDI BILL 2017
· MAY 2020 : ATMA NIRBHAR BHARAT ABHIYAN
· BUDGET FEB. 2021: GOVT. ANNOUNCED PRIVATISATION OF 2 PUBLIC SECTOR BANKS.
· BILL LISTED IN WINTER SESSION OF PARLIAMENT IN NOVEMBER, 2021
· FM ANNOUNCED – IDBI BANK TO BE PRIVATISED: JULY 2021
· PANAGARIA REPORT – JULY 2022 : ALL 12 PSBs SHOULD BE PRIVATISED.
All these Committees have, in one way or the other, recommended privatisation of Banks, dilution of priority sector credit, closure of non-viable rural branches, emphasis on commercial profit rather than social profit, etc.
In November, 2025 our Hon. FM said :
- Bank nationalisation done in 1969 has not yielded the desired result as far as financial inclusion was concerned.
- Privatisation of banks unlikely to hurt financial inclusion drive, national interest.
- Government control made Public Sector Banks unprofessional
Few months ago, Hon. Finance Minister said that the present younger generation find that PSBs are not that “COOL”.
On 14th October, 2026, the Cabinet Committee has approved the sale of IDBI Bank to Fairfax, the investor from Canada thus deciding to hand over this Bank to a foreign investor.
Earlier we have seen Lakshmi Vilas Bank was handed over to DBS, Singapore. CSB Bank was sold to Fairfax. RBL Bank has been sold to NBD, Dubai. Bulk of the share of Yes Bank has been sold to SMBC, Japan.
This Government has also amended the law for disinvestment in Regional Rural Banks to allow private capital in RRBs. Same is the case with Co-operative Banks. Insurance sector also is not an exception.
Thus, the financial sector as a whole is the target. Hence, we can understand what this High-Level Committee will recommend. They are on their job. As discussed and decided in our 30th Conference held in Bengaluru in April/June, 2026, let us be on the guard.
From 1991, in the last 35 years, we have observed 55 strikes against these reform policies. Let us intensify our campaign. Let us be ready for further struggles. Let us keep our rank and file prepared.
With greetings,
C.H. VENKATACHALAM GENERAL SECRETARY