The Telegraph
Since 1st March, 1999
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IDBI staff on the warpath over recast

Mumbai, Nov. 19: After the Unit Trust, it could now be the turn of employees of the Industrial Development Bank of India (IDBI). Employees of the financial institution, largely from the non-officer cadre are irked over the recent move to convert it into a banking company, which they fear signals impending privatisation.

Sources said employees associated with the All India IDBI Employees Association are likely to go on a nation-wide agitation if the government converts IDBI into a banking company.

“Close to 4,000 employees across the country are opposed to the move, which could lead to the privatisation of the financial institution in the near future. The association wants the existing structure of IDBI to stay,” president Suryakant Mahadik told the The Telegraph.

“We have also asked minister of state for finance Anandrao Adsul, Sonia Gandhi, Manmohan Singh and 45 other Opposition members for their assistance,’’ he added. However, even as employees of IDBI seem to be wary of privatisation, the Centre’s move has met with a different reaction from the officer community who welcome it on condition that service rules in the new banking company are not reversed.

On November 11, the Cabinet had cleared a financial package for IDBI that envisaged repeal of the IDBI Act in the Winter session of Parliament. This will pave the way for the institution’s conversion into a banking company with specific characteristics. While IDBI has access to retail deposits to bring down its cost of funds, the institution has also been given some relaxations on the statutory liquidity ratio (SLR) front. The government also agreed to take over contingent liabilities to the extent of Rs 2,500 crore over five years.

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