UPA, Left on common approach towards banking reforms

Our Economy Bureau
20 January 2005

New Delhi: The United Progressive Alliance (UPA) has narrowed down internal differences with the Left parties over pending banking reforms by giving an assurance that the restructuring exercise would not result in any significant retrenchment in the sector.

At a UPA-Left coordination committee meeting on Wednesday, the Left parties on their part are understood to have grudgingly agreed not to come in the way of the government''s move to permit higher FDI limits in private sector banks.

However, they wanted regulatory safeguards to ensure that foreign banks do not swamp the Indian banking sector through takeovers.

The government has also agreed to come out with a detailed roadmap for economic reforms that would be discussed with the Left parties.

Apart from the prime minister, Manmohan Singh, the meeting was attended by the chairperson of UPA, Sonia Gandhi; the finance minister, P Chidambaram; the CPI (M) general secretary, Harkishan Singh Surjeet, the CPI leader, A.B. Bardhan, and other senior Left leaders including Sitaram Yechury and D Raja.

"It was a general exchange of views on the implementation of the National Common Minimum Programme. The primary discussion was on reforms of the banking sector," Chidambaram told reporters after the meeting.