Will IDBI be finally privatised-AIBEA meet Jaitley, urges to roll back decision

Will Narendra Modi led NDA government be finally able to privatise IDBI Bank? An attempt which has been in place since 1991, 27 years since the bank was established way back in 1964 as a development finance institution. During last winter, Minister of State for Finance, Jayant Sinha clearly spoke about his Ministry's desperation to privatise the bank and till then the VIjay Mallya saga and involvement of certain top officials of IDBI Bank did not come to light. Situation in October 2015 and now are different and the government which came into power raising much expectations amid commoners as well as business and industry, will now have to at least show some work. Its earlier plan to raise around Rs 65,000 crore from divestment miserably failed and privatisation of IDBI by disposing off its at least 27 per cent of government stake may help union Finance Minister, Arun Jaitley and his deputy, Sinha to save their faces for now. But then, will it finally happen or not? With the euphoria in the stock markets, share price of IDBI Bank witnessed a jump to Rs 73 per stock last week only while it was hovering in 50s during last month. Speculations are albeit helping the stock go upward, though slowly but steadily.

Meanwhile, a not-so-market friendly step coming from the largest union of bank employees, AIBEA on Friday, may dampen the spirit of the IDBI stock-holders. A high-level representation of the employees' union met Jaitley and urged him not to go for privatisation of the bank. Something that the union finance minister obviously did not expect coming in these tough days. Jaitley, as per grapevine, is too keen to let IDBI privatisation happen as it will at least send a message across the trade and industry that the government is trying for some financial and banking reforms. But will the government be able to handle muscle-flexing by AIBEA and also other IDBI employees' association, that is a question worth billion-dollar and only time can give a reply to this expensive question. All India IDBI Officers' Association has also now raised its voice and made it clear that the officers of the bank under the banner of this outfit will go for all possible sorts of protests, agitations to ensure government does not take the steps to privatise the bank. The officers' union believes capital infusion by the finance ministry will help the bank to go for expansion as per its plan and also battle the NPA menace. IDBI has lost Rs 900 crore to Vijay Mallya alone, forget about other such wilful defaulters named in the list. In his budget speech, Jaitley spoke about government steps to be taken to keep IDBI in good health, surprising many as usually finance ministers avoid taking any particular name of a bank, corporate or industry. Interestingly, currently the government holds around 76 per cent stakes in IDBI Bank and Jaitley's target is to bring it down to below 50 per cent in next quarter, only if the bank's employees allow the government to do so.