INDRADHANUSH MISSION TO REVAMP FUNCTIONING OF PUBLIC SECTOR BANKS

Union Finance Minister Arun Jaitley in New Delhi recently has launched a seven pronged plan called Indradhanush Mission to revamp functioning of public sector banks (PSBs). It aims at achieving the objective of economic growth revival through improving credit and minimizing the political interference in the functioning of PSBs. The seven colors of Indradhanush mission include appointments, board of bureau, de-stressing PSBs, capitalization, empowerment, framework of accountability and governance reforms. According to MoS Finance Jayant Sinha, “This revamp will be the most comprehensive plan since nationalization of banks in 1969. This would give banks the strategic space for adequate competitive positioning.”

INDRADHANUSH MISSION FEATURES:

1) Appointments: Selection of non-executive chairman in remaining 6 state owned PSBs till November 2015. Appointing MD & CEO of two PSBs as early as possible.

2) Bank Board Bureau (BBB): It will be a body of ’eminent’ professionals to be selected within 6 months i.e. February 2015. It will become functional from Financial year 2016-17 i.e. form 1st April 2016

3) De-stressing PSBs: To develop vibrant debt market for PSBs in order to reduce lending pressure on banks. Strengthen asset reconstruction of companies.

4) Capitalization: Infuse 25,000 crore rupees of capital into debt-laden banks in this fiscal in phased manner. Out of this 20,000 crore rupees would be injected in August 2015. Rest 5,000 crore rupees will be performance based allocation to be allocated in the last quarter of 2016

5) Empowerment: Provide greater flexibility in hiring of manpower in PSBs.

6) Framework of accountability: It will seek to streamline vigilance process for quick action in case major frauds and also include connivance of staff.

7) Governance reforms in PSBs: Next Gyan Sangam (also known as the Banker’s Retreat) will be held from 14 to 16 January 2016. Employee Stock Option Plan (ESOP) will be initiated for top management.

NOTE:

This Indradhanush Mission is not to be confused with the Mission Indradhanush under Ministry of Health and Family Welfare (MOHFW) with the aim of expanding immunization coverage to all children across India by year 2020. The Mission Indradhanush there also depicts seven shades of the rainbow which are seven vaccine preventable diseases namely Diphtheria, Pertussis, Tetanus, Childhood Tuberculosis, Polio, Hepatitis B and Measles.

  Author: Palak Tiwari, a freelancer writer based in Bhopal Start your IAS Preparation today itself