Delhi CM urges PM to stop privatisation of IDBI

Pointing out that the Industrial Development Bank of India was set up in accordance with the provisions of the Industrial Development Bank Act, 1964, Delhi Chief Minister Arvind Kejriwal on Saturday wrote a letter to Prime Minister Narendra Modi urging him to stop the privatisation of the bank as it has played an important role during the last five decades in the industrial development of the country through its coordination with main financial institutions.

The chief minister in his letter opposed the proposed privatisation of IDBI, which was mentioned by Union finance minister Arun Jaitley during his Budget speech on February 29, stating that the reasons being given to justify its privatisation were fundamentally flawed.

“The IDBI is a profit-making public sector bank, and according to the bank’s financial statement, its operating profit before provisions and contingencies till December 2015 stands at Rs1,117 crore, therefore it will be unjustified for the Central government to reduce its stake below 51 per cent in this bank,” he stated.

“It is being said that the reason to privatise IDBI is that the government wants to sell its shares in a bid to earn money. If this is the reason behind the move, it will be very wrong. IDBI is one of the profitable banks in the country. The bank’s operating profit before provisions and contingencies till December 2015 is Rs 1,117 crore. Profitable banks such as this should not be privatised,” he said in the letter.

Mr Kejriwal further pointed out that the non-performing assets (NPAs) of the IDBI are mainly the dues recoverable from big industrial houses and the Central government should allow this bank to strictly recover these dues in place of citing it as a reason to privatise it.