Why nationalisation of banks

Fifth, several sectors tended to get ignored in the existent system and by nationalisation, the government would be able to ensure that credit flowed to high priority areas like agriculture, small industry, exports, special castes etc.

Sixth, by expanding on bank branch network across the country, the system would also generate jobs as more manpower would be required. Hence, there would be an impetus to job creation. Looking back today, it would be hard to counter any of these arguments. First, these objectives still remain etched in our policies and hence cannot be discontinued. Second, as standalone objectives, there can be no quarrel with any of these stated goals.

Have there been any gains on account of nationalisation? The answer is yes because the spread of the banking system across the country and to all corners has been driven by this overall objective. The public sector bank PSB system is still dominant and accounts for tw0-third of the total deposits and credit in the system. Several programmes of the government have been driven by the PSBs by virtue of their ownership pattern.

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Process of Bank Nationalization It could be expressed as a process whereby the National government or the state becomes empowered to take over the private industry, organization or even the assets into their ownership i. History of Nationalization The history of Nationalization can be traced back in the which is also known as the pre-independence period.

What was the Need to Nationalize? Conclusion As discussed earlier that the liberalization in the policies have led to more private banks coming to effect, the public banks and their dominance have shifted. Is there a Fundamental Right to Drink Liquor? Everything you should know about the Yield Curve 5 Aug India vs.

Presidential System 6 Nov Are Prenuptial Agreements Valid in India? Legal Compliances every Start-up should know 16 Sep How to file a Case in Consumer Court? Finology on Facebook Finology. Bank nationalization succeeded in specific areas such as financial deepening because of the rapid spread of branches, but it eventually did more harm than good.

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