THE COVID-19 epidemic has been wreaking devastation on the planet for over a year and a half. India has not been immune to the pandemic's impact. Over the last several months, there has been a lot of talk about how the epidemic has damaged the Indian economy, including concerns like a negative growth rate, growing unemployment, and an increase in non-performing assets, with few solutions. Against this context, the Union Budget for the fiscal year 2021-22 was inevitably eagerly expected. In the months preceding up to the Budget address, there was much discussion on what the government should and should not do in such a circumstance. Later, following Union Finance Minister Nirmala Sitharaman's Budget address in Parliament, the discussion has continued - some have welcomed the budget, while others have criticised it.
There are no simple solutions. Following privatisation, the government cannot require newly privatised banks to continue providing beneficial services to the poor, since this would infringe on their freedom to do business freely. Indeed, the legal position on private bank accountability supports this view. Following the Supreme Court's decision in Federal Bank Ltd. v. Sagar Thomas and Others, REED 2003 SC 09001, the higher court has usually regarded private banks as entities not subject to its writ jurisdiction for the enforcement of fundamental rights. Though there has been considerable court opposition to this viewpoint in recent years, it cannot be viewed as changing an established legal position. As a result, there appears to be no mechanism to persuade newly privatised banks to continue providing useful services to the poor. However, it is critical to guarantee that essential services are not discontinued or more burdensome as a result of privatisation. If this occurs, it will be another blow to those who have suffered the most throughout the epidemic, undermining their right to life and a living. For example, newly privatised banks may cease the PMJDY's minimum balance rule, which would be disastrous. Private banks have traditionally been missing from the implementation of the PMJDY, which does not speak well for any possible future beneficiaries. Concerns about loan arrangements for MSMEs and cottage enterprises are similar. In this way, the cessation of public welfare services in newly privatised banks contradicts the government's widely publicised goal of true financial inclusion and economic progress.
Overall, it is obvious that any choice to privatise banks must take these issues into account. It is critical that the government recognise the anti-privatisation protests as problems impacting the population at large, particularly those most impacted by the pandemic. A more comprehensive approach to these problems will result in a more fair reform process.