india

Updated: Sep 01, 2019 09:12 IST

The Bharatiya Mazdoor Sangh (BMS), labour wing of the RSS on Saturday criticised the bank merger plan announced by Union Finance Minister Nirmala Sitharaman saying it was done without any study and it will only protect interests of corporate houses.

“No serious study was done in this. It seems the government has not learned lessons from earlier mistakes. There will be dislocation and retrenchment of employees. Decision like this will only help corporate bodies,” BMS’ all-India president Saji Narayanan said in Thrissur.

He said the BMS will support the agitation being planned by United Front of Banking Unions. The BMS is considered as the largest trade union in the country in terms of members and presence.

On Friday the Union Finance Minister had announced merger of six public sector banks with four better-performing anchor banks in a move to boost India’s ambition of achieving a $5 trillion economy.

Narayanan said after the 2008 global meltdown many experts in the United States had said big banks create bigger shocks and warned against big merger plans.

“With 130 crore population decentralized banking is most appropriate for the country. In 2008, India was least affected because of this. In India, banking is relation-based. With the entry of big players, competition to provide best services to customers will vanish,” he said.

The BMS chief said the government’s latest decision will add to the misery of the economy.

“Though the minister has promised that there will be no dislocation or retrenchment these will remain only on papers. Persons who come from smaller banks will remain second class employees. There can be mass dislocations. The government should have done a proper study before taking a sweeping decision like this,” he said.

He also said more than 80 per cent of the micro-industries were dependent on small banks and enhanced credit system will be affected after the entry of big banks.

“In rural areas MSMEs (micro, small and medium enterprises) provide maximum jobs. For bigger banks, these MSMEs can be irritants. So disbursal of loans and other lending will be affected,” he said. This is not the first time the BMS has opposed the union government’s plans. Earlier it had criticised the government’s disinvestment plan and labour codes.