Citing an example, he said that Air India simply separated itself from the private sector and was nationalized in 1993.
“In 1969, the banks were just pulled and nationalized. So when people say that these institutions were built on the blood and sweat of the Indian bureaucracy, let me point out that these things were originally built by private companies,” he said. he said at a media conclave.
He said that Finance Minister Nirmala Sitharaman has already delineated strategic and non-strategic sectors for the purpose of privatization and that there will be a minimal government presence in the strategic sector.
He also said that the government will not shy away from creating new public sector entities where necessary.
Giving an example of the creation of a development finance institution (DFI), he said that the government recently created the National Bank for Financing Infrastructure and Development (NaBFID) to finance the huge infrastructure requirement.
Speaking of the banking sector, he said that it is part of the strategic sector and the government will have its presence in the sector.
“There are certain reasons why you want to do that … the fact is that there are also problems with private sector banking. We have seen certain instances like YES Bank, etc. also need a public presence,” he said.
Many countries around the world have retained some public banking systems, or even, in the case of the global financial crisis, had to nationalize them, he said.
Last year, the capital-starved YES Bank was placed under a moratorium and its board of directors was replaced. Several agencies are investigating the fraud carried out by the previous administration.