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.

This will be the first budget presented by the government led by Prime Minister Narendra Modi in its third term amid high anticipation following President Droupadi Murmu’s assertion that it will be marked by many historic steps.

In her address to a joint sitting of Parliament, she had said major social and economic decisions will be a highlight of the budget.

An interim budget was presented in February due to the Lok Sabha polls, which were held in April-June.