More banking reforms coming soon, says Arun Jaitley

Mumbai, Feb 14 (IANS) The government will unveil a series of banking reforms in the coming days but it has no intention to exit from the sector, Finance Minister Arun Jaitley said on Sunday.

“There are a series of banking reforms which I am likely to announce in the days to come… you may find something on that,” Jaitley said at a forum here during the government’s Make In India Week event here.

“I don’t think India has reached a stage where the state can pull out of banking altogether,” he said.

Declaring state-run banks to be a necessity because of their major role in financial inclusion, he said the government was already committed to bring down its holding in these to up to 51 percent.

The finance minister’s comments come after public sector banks posted poor earnings for the third quarter and an asset quality review by the Reserve Bank of India showed a major rise in bad assets and provisioning.

Regarding the government’s commitment not to interfere in the running of banks, Jaitley said: “We have erred in the past on this.”

Jaitley also said the government is committed to provide a predictable and stable tax regime, adding that tax demands raised in the past have given the country a “bad reputation”.

He said the government has embarked on a path to make India’s tax regime globally competitive and the move to bring down the corporate tax gradually to 25 percent is a part of the strategy.

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