Union Finance Minister Nirmala Sitharaman.
| Photo Credit: PTI

The government is likely to introduce amendments to Banking Regulation Act 1949 and other laws to push banking sector reforms during the upcoming Budget session.

Apart from this, amendments in the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, and the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 are needed for privatisation of public sector banks, sources said.

These Acts led to the nationalisation of banks in two phases and provisions of these laws have to be changed for the privatisation of banks, they said.

Amendments, if approved by Parliament, would help bring down government holding in state-owned banks below 51%, improve bank governance and enhance investors’ protection, sources said.

Parliament session beginning on July 22 would witness the Budget presentation on July 23 and conclude with the passage of the Finance Bill on August 12.

It is to be noted that the government had listed amendment to these laws to be taken up during the winter session in 2021, but these bills could not be tabled.

“To effect amendments in Banking Companies (Acquisition and Transfer of Undertakings) Acts, 1970 and 1980 and incidental amendments to Banking Regulation Act, 1949 in the context of Union Budget announcement 2021 regarding privatisation of two Public Sector Banks,” as per the list of legislative business for the winter session.

Finance Minister Nirmala Sitharaman, while presenting the Budget for 2021-22, announced the privatisation of public sector banks (PSBs).

“Other than IDBI Bank, we propose to take up the privatisation of two PSBs and one general insurance company in 2021-22,” she had said.

To ensure privatisation of a general insurance company, the government has already received approval from Parliament for the General Insurance Business (Nationalisation) Amendment Bill, 2021, in the monsoon session ended in August 2021.

The government in April 2020 consolidated 10 PSBs into four and as a result, the total number of PSBs came down to 12 from 27 in March 2017.

As per the amalgamation plan, the United Bank of India and Oriental Bank of Commerce were merged with Punjab National Bank, making the proposed entity the second-largest PSB.

Syndicate Bank was merged with Canara Bank, while Allahabad Bank was subsumed in Indian Bank. Andhra Bank and Corporation Bank were amalgamated with the Union Bank of India.

In a first three-way merger, Bank of Baroda merged Vijaya Bank and Dena Bank with itself in 2019. SBI had merged five of its associate banks — State Bank of Patiala, State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Travancore, and State Bank of Hyderabad — and also Bharatiya Mahila Bank effective April 2017.

Budget session of Parliament will be held from July 22 to August 12, said Union Parliamentary Affairs Minister Kiren Rijiju

Union Parliamentary Affairs Minister Kiren Rijiju, on July 6, said that the Budget session of Parliament will be held from July 22 to August 12. Mr. Rijiju added that the Union Budget 2024-25 will be presented on July 23.

Mr. Rijiju in his X (formerly Twitter) post said “Hon’ble President of India, on the recommendation of Government of India, has approved the proposal for summoning of both the Houses of Parliament for the Budget Session, 2024 from 22nd July, 2024 to 12 August, 2024 (Subject to exigencies of Parliamentary Business). Union Budget, 2024-25 will be presented in Lok Sabha on 23 July, 2024.”

After the general elections 2024, a special session of Parliament was held from June 24. The new Members of Parliament took oath and President Droupadi Murmu addressed the joint session of Parliament on June 27.

MPs in the Rajya Sabha during the Interim Budget Session of Parliament, in New Delhi on Friday.
| Photo Credit: ANI

Opposition leaders from the INDIA bloc in the Lok Sabha on February 9 said the White Paper brought out by the Narendra Modi government on the state of the economy under the Congress-led United Progressive Alliance (UPA) was a “political manifesto” that was aimed at “tarnishing” the Manmohan Singh government.

Most of the members questioned the government why it had not mentioned the November 2016 demonetisation in the White Paper, unemployment, inflation and faulty implementation of GST. Several of them recounted the BJP’s pre-poll promises like creating two crore jobs every year, putting ₹15 lakh into the accounts of every citizen after brining back black money, bringing down the prices of fuel and cooking gas and making the rupee stronger against the dollar.

Two Opposition members — RSP’s N.K. Premachandran and Trinamool Congress’s Saugato Roy — had moved a substitute resolution to highlight the failures of the Modi government and appealed to the House to disapprove the government’s White Paper even though the Opposition doesn’t have the numbers in the Lok Sabha.

Parliament Budget Session – February 9 updates

Responding to the allegations of endless scams under the UPA, Congress and DMK members asked the Modi government to spell out the concrete steps it took to put the guilty behind bars in the past 10 years.

“It is a matter of 10 years. Have you taken any action against any political leader?” asked Congress leader Manish Tewari who led the charge from the Opposition benches.

“If you wanted to bring a White Paper, you should have brought it in 2014. The intention behind this White Paper is only political. This is a political manifesto, not a White Paper,” he said.

Landmark legislation

Mr. Tewari said that under former Prime Minister Manmohan Singh and UPA chairperson Sonia Gandhi, the UPA brought landmark legislation like right to food under the National Food Security act, right to employment under the MGNREGA, right to compulsory and free education and creation of unique identity under Aadhaar. “What has been your achievements in the past 10 years,” he asked.

Congress leader in the House, Adhir Ranjan Chowdhury, said, “At the fag end of this session, this kind of White Paper only with an objective to tarnish the 10 years of UPA government does not cut much ice.”

Stating that “Rome was not built in a day,” Mr. Chowdhury asked why the BJP constantly abused the Nehru-Gandhi family and mentioned how Jawaharlal Nehru and Indira Gandhi are constantly targeted by the ruling dispensation.

His deputy, Gaurav Gogoi, accused the government of using the Enforcement Directorate to “welcome the corrupt into the BJP”. “The action rate of the raids from 2005 to 2014 was 93%, which has now been reduced to 29%. Only 23 convictions under the PMLA (Prevention of Money Laundering Act) have been secured…. Why is the conviction rate so low? Because these raids are motivated,” Mr. Gogoi alleged.

‘Baseless allegations’

Mr. Premachandran said the NDA government had devastated the economy and the White Paper didn’t talk about unemployment and high inflation. “What is the bona fide intention of this White Paper… If you are so hopeful and confident, then what is the intent of this paper,” the RSP leader said, adding that the BJP government is coming up with baseless allegations.

Trinamool leader Mr. Saugato Roy said the government and the Finance Minister should apologise for the demonetisation and putting the country into severe hardships.

Talking about the recent troubles with payment app Paytm, Sharad Pawar-led NCP leader Supriya Sule said Google Pay and Phone Pe are ticking time bombs. “Google Pay, Phone Pe are two sitting time bombs. BHIM app is hardly used while Google Pay and Phone Pe apps are used [widely]. What is the government doing on digital or cashless economy?” she said.

Union Finance Minister Nirmala Sitharaman speaks in the Lok Sabha during the Budget session of Parliament, in New Delhi, Friday, Feb. 9, 2024.
| Photo Credit: PTI

Fugitive economic offenders like Vijay Mallya, Nirav Modi, and Sanjay Bhandari will be extradited to India, Finance Minister Nirmala Sitharaman said on February 9, even as she charged the former Congress chief Sonia Gandhi of being a ‘Super Prime Minister’ in the United Progressive Alliance (UPA) years, blaming “rudderless” leadership for the “one big-ticket scam a year” decade between 2004-2014.

Speaking on the White Paper on the Economy in the Lok Sabha, the Minister said it was a serious document tabled with responsibility as it impacted the lives of people and shall serve as a record for posterity. “…Entire India’s youth should know what effort it took for a Prime Minister with a vision to restore India to its glory,” Ms. Sitharaman said, comparing the Commonwealth Games “flop show” to the “grand” success of G-20 events.

In her opening remarks, she went beyond the UPA decade to remind the House about the LIC of India being forced to invest in an ailing West Bengal firm run by Haridas Mundhra in the 1950s, which culminated in the then Finance Minister T.T. Krishnamachari’s resignation as “a sacrificial lamb”. She also talked about former State Bank of India chairman R.K. Talwar being forced out of office in 1976 when he refused to grant a particular loan to someone close to the government of the day.

She later explained these cases were critical to understand that corruption is a part of the Congress’ DNA. Stressing that national security was compromised in the UPA years, the environment had become a bottleneck for project clearances, hurting development, and the leadership of the day “failed” the country.

Terming the National Advisory Council (NAC) headed by Ms. Gandhi as an “extra-constitutional body worse than a Kitchen Cabinet”, the Minister asked why 710 government files were sent to the NAC office. On Congress MPs’ claims that Aadhaar, MGNREGA, and direct benefit transfers were UPA’s projects, Ms. Sitharaman noted that Ministries had objected to the Aadhaar project at the time.

“Andolanjeevi [a person who makes a living through protests] and BhrashtacharJeevi [a person who survives on corruption] gave birth to the ‘Jayanti Tax’. Licence Permit Raj was brought back through the Environment Tax,” she said, pointing to a rise in average time taken for green clearances from 86 days in 2011 to 316 days in 2014. This has now come down to 70 days, she added, with this government balancing development and environment needs.

Stating that the Enforcement Directorate (ED) was told to “keep quiet to facilitate money laundering” during the UPA years and kept like a “caged bird”, she noted that just 102 prosecutions took place then, compared to 1,200 since 2014. Zero persons were convicted in their tenure, while the number is 58 in our watch, she said, attributing it to the ED being given the “independence to stop money laundering”.

“We have got extradition orders passed in four cases [of fugitive economic offenders] and are extraditing them,” she said, noting that 12 people have been labelled fugitive economic offenders under their watch, while the number of such extraditions was zero during the UPA years.

On why the paper was tabled now, the Minister cited Prime Minister Narendra Modi’s remarks in 2015-16 about refraining from presenting such a white paper at that time in national interest, emphasising that not a single investor would have come to the country and citizens would have lost faith in the system.

“Now, with 10 years of sincere effort to clear up the economy, governance, and making sure that we are not going to stagnate because of the legacy that was left behind… We have 10 years which can therefore be periodically compared with those 10 years… Responsibly, we took the challenge of sorting things out, and now we have put it out there,” she said on the timing of the white paper.

\Former Finance Minister and Congress leader P Chidambaram.
| Photo Credit: ANI

The White Paper by the Narendra Modi government on the state of the economy under the Congress-led United Progressive Alliance (UPA) is a “hatchet job” and “a white lie paper,” former Finance Minister P. Chidambaram asserted on February 9.

“It is a white lie paper. Even the authors will not claim that it is an academic, well-researched or scholarly paper. It is a political exercise intended to damn the previous government and hide the present government’s broken promises, monumental failures and betrayal of the poor,” Mr. Chidambaram said.

Parliament Budget Session – February 9 updates

The former Finance Minister said no other government had made so many “wild promises” as the Modi government and then broken them “without an expression of regret”.

Mr. Chidambaram pointed out that the Modi government had promised two crore jobs every year, bring back black money parked abroad in 100 days, put ₹15 lakh in every citizen’s bank account, bring down prices of petrol, diesel at ₹35 a litre, build 100 smart cities by 2022, double farmers’ income, house to every family by 2022 and achieve a $5 trillion economy by 2023-24.

“In fact, the government laughed them away as election jumlas,” he said, adding, “The paper released today is not a white paper; it is a paper that is intended to whitewash the many sins and commissions of the NDA government in the last 10 years”.

Also Read | Congress ‘black paper’ on ‘Modi government’s failures’ focuses on unemployment and neglect of non-BJP States

Fiscal deficit

Giving a comparative analysis, the former Finance Minister said fiscal deficit was 4.5% in the last year of the UPA regime and 5.8% in the last year of the NDA; household saving as percentage of GDP was 23% under the UPA and 19% under the NDA; national debt under the UPA was ₹58.6 lakh crore while it is ₹173.3 lakh crore under the NDA.

“The Indian economy recorded the ‘golden period of growth’ in the three years between 2005-06 and 2007-08 when the GDP grew at 9% or more at an average of 9.5%,” he added.