With reference to “Privatising PSBs isn’t easy” (April 17), T T Ram Mohan is right in pointing out that “the problem at two large private banks have reinforced doubts about how well boards in private companies perform in practice”. The crisis pertaining to swiftly declining asset quality and poor governance causing big frauds is not because the ownership rests with the government. Irrational and irresponsible decisions on matters relating to deployment of funds, human capital and enhancing efficiency in business growth and returns have pushed public sector banks (PSB) into the present crisis. Corrections are needed to rejuvenate PSBs. Their role is too big in driving growth and for that the ownership must rest with the government, which should also distance itself from the business of banks.
Reforms to improve efficiency of PSBs have failed to yield results. Privatising PSBs will pave way for the private sector to control the economy in a significant way that would be disastrous in the long term. Why are stringent measures not taken to weed out corruption and growing inefficiencies, and why is the government failing to book fraudsters and recover public money? It should execute measures to ensure financial discipline across the economy.
VSK Pillai
Kottayam