After emptying the hard saved reserves in the coffers of the Reserve Bank of India, the central government has announced the merger of 10 more public sector banks to form four mega banks. While the country is facing an unprecedented economic sickness, the GDP down to a six-year low at 5 per cent and unemployment at its peak, one wonders why the government has rushed with the merger of 10 banks which is not going to be a smooth transition for various reasons. Even the merger of all subsidiary banks into the State Bank of India has proved futile. Though the NPA levels would come down technically, percentile-wise, the quantum would remain stubborn despite the window dressing.
It appears as if the government is rushing with such moves only to divert the attention of the public from the economic crisis the country is pushed into. Moreover the government appears to have learnt no lessons from the havoc the suddenly announced demonetisation and the haphazard manner in which the GST was implemented brought on the country's economy.
Tharcius S Fernando
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