Nationalisation of Public Sector Banks

Indira Gandhi the great former Prime minister of India initiated and put effect toNalizatiomn of Banks in 1969.This was much against the will of those who believed in money accumulated privatelily instead of publicly.Morarji Deasai who was a cabinet rank Minister in the Indira Government opposed Nationalisation very strongly.He was even offered the post of Dy Prime Minister which he refused because he was so adamant about rescuing people who were interested in managing the entire wealth of India privately.Finally he resigned.India thus lost an able Minister. But later on certain unexpected circumstances were becoming cause for herassassination. Thereafter her son Rajiv Gandhi assumed charge of Prime Minister. The policy of Indira Gandhi to Nationalize leading banks of India resulted in the extraordinary growth of Banking system in India.Indian economy started growing rapidly with many reforms helping to achieve India Stability as compared to fast growing nations of the world.Rajiv Gandhi alongWith Sam patroda computer expert in the Information Technology Branch helped India grow further besides financially in the field of Computer Technology also.Many people those days opposed Computer also saying the Computer would result in the loss of work for the labourers and Working class of India.But later on this was proved an illusion. Rajiv Gandhi also played a big role in making India Digital gradually but surely.However, Rajiv Gandhi was not lucky enough to survive to see India becoming totally digital reducing cash transactions and encouraging thereby digital transactions. He was also assassinated later on. By this time all Nationalized banks were known as Government Banks.As a result of Nationisation the Natiolised Banks began to open their branches even in remote villages Thus the noumber of Public sector Banks increased more than before.SBI was the biggest among them since the NationalisationWhen the services of Banks Spread to villages also.When this services of Banks spread all over India it helped not only to promote the financial stability of the Nation but simultaneously helped to fo Find more opportunities for employment of people, This had helped the Agriculture sector of India also which was always considered to be the surviving nerve of the nation.The Banks began to give loans to those who were interested in Agriculture.Many people got loans.But all did not use them for Agriculture alone and used the money for other purposes also as there were no effective checkto check tyeir utilisation except certificates from officers and the words from the the people who did farmings of different sorts.In fact Banks had no continuous efforts to verify the right way of use of the money they paid as loans. However, the loans helped developments within the Nation to a very large extent to which Banks played a major part by making money available liberally.The faith people had in Public sector Banks increased many folds. Thus the deposits people made in Banks also increased . They n played a big role in making the Nation financially stable.People also began to view Nationalised Banks more dependable than Private Banks.But still the private banks also were given permission to function liberally.This also added to the stability of the Nation in terms of Finance,.India was really shining to get placed among developing Nation.The world began to recognising India as a Nation of worthy of being considered as ranking Nations in the field Of development. When the regime of Narasimha Rao as prime minister began,he selected Manmohan Singh a highly qualified person to become his Finance Minister.This helped in building a strong India literally because the PM& FM together began purchasing US Dollars from open market on a regular basis.This resulted in an India building up a very strong Nation with her Foreign Exchange Reserve.In fact it was this Foreign Exchange Reserve that enabled India to stand on her own legs keeping head high even whenthe Global Financial crisis wrecked every part of the World.All other claims in this regard are just illusions. However ,nowadays a trend is in the offing so as to jeopodise the benefits of loans did to India.This is because of the fact the loans paid to different parties including big corporates were not repaid on time.So the Government had to write off a major part of loans afforded to different category of people.The Banks and the Government had causes of difference for the lapse to recover the loans.The present situation is somewhat alarming. Nowadays Banks are facing challenges which were not so strong before.They are unable to find ways and means to meet the challenges effectively.The Merging of Banks or Privatisation of Banks as in the case of other Public sector undertakings is never a effective remedy to overcome the resistance caused by the lapse of recovering loans on time on a systematic way.Even employing people to recover loans given to Public did not meet with sure results. In the circumstances ,what is required is or to be précis the need of the time is to impart with loans carefully by imposing condition for their repaying systematically and on time.For this new measures will have to be found.One of them is to give more powers to banks to use their discretion how to part with money as loan and how to recover them totally on time and with true effect on those who availed off the loan. More and more Privatisation to find way to get more investment from outside and thinking of strengthening the economy of the Nation is just an illusion and not practical had been proved time and again.So India will have to find more dependable methods including changes wherever necessary. At the moment the best remedy seems to be be reducing the distance between Public Sector Banks and Private Banks.For this feeling among them to the effect that we are all Woking for building up a self sufficient Nation should be spread with a view to ensuring thatpublic money is rightly and properly used by all including General Public. SreedharanMundanat 6 th April 2018