The Hindu : National : Left nod for one Banking Bill

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Friday, Aug 04, 2006

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Left nod for one Banking Bill

Special Correspondent

It seeks to empower Government to dissolve PSU Bank boards

NEW DELHI: The Left parties have agreed on the passage of the Banking Companies and Financial Institutions Law (Amendment) Bill, 2005 that seeks to empower the Government to dissolve the Boards of Public Sector Banks with a rider.

Communist Party of India parliamentary party leader Gurudas Dasgupta conveyed the Left parties' decision to the Government after two rounds of consultations.

The CPI leader told Leader of the Lok Sabha Pranab Mukherjee that they would support the passage of the Bill provided the Government does not do away with having a nominee of the Reserve Bank of India on the reconstituted board. Earlier this week trade union leaders and Left leaders met Finance Minister P. Chidambaram and said they were against the proposal to withdraw the RBI nominee directors from the boards of public sector banks. This, they said, would be highly detrimental to the functioning of the banks and removal of the RBI nominee would loosen the control at the policy and decision making level.

"This initiative has been taken so as to remove the misconception that the Left parties were only creating obstructions in the functioning of the Government," Mr. Dasgupta said.

Mr. Dasgupta said after the meeting he and Left leaders had with the Finance Minister, he took the initiative and discussed it with Chittabrata Mazumdar, MP before giving their go ahead.

Four Bills

Of the four Banking Bills the Government wants the Left to consider, this is the first Bill that has been cleared. Opposition to the Banking Regulation (Amendment) Bill, 2005 that seeks to remove the 10 per cent voting right caps for shareholders still remains. The other two Bills including Payment & Settlements System Bills, 2005 and the State Bank of India (Subsidiary Bank Laws) Amendment Bill, 2006 are to be sent to the Standing Committee.

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