The Hindu Business Line : CPI (M) flays move to allow foreign banks to acquire shares

THE CPI (M) Polit Bureau Member, Mr Prakash Karat, has criticised the recent statement of the Union Finance Minister, Mr P. Chidambaram, where the latter had said that the Government is open to allowing acquisition of shares - up to 10 per cent a year - by foreign banks in domestic private banks and taking controlling-stake in three to four years.

Addressing presspersons here, Mr Karat said, "We are unable to understand why the Finance Minister is eager to hand over private banks to foreign banks. We are not going to accept this `unfair advantage' given to foreign banks to `swallow Indian banks'."

Mr Karat wondered how does this decision form the part of the common minimum programme (CMP) of the UPA Government.

At a time when some of the Indian private banks are doing well why does the Government want to facilitate the foreign banks to take over private banks, he asked.

On consolidation moves in banking industry, he said that he has heard about the moves to have small number of big banks through media.

"We are not going to support that move," he said.

There is a wide network of branches of scheduled commercial banks in rural areas. His party does not want the Government to dismantle the benefits of the 1969 bank nationalisation, he said.

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