Where the government could have gone a step ahead is to overhaul public sector banking structurally. Public sector banks have to suffer interference from the government and the bureaucracy. Also Read: Banking reforms must complement bank recapitalisation planOnce bank balance sheets are cleaned up, it is time the government give up ownership of some banks. While some public sector banks may be needed for some financial inclusion objectives, do we need so many state-owned lenders? Another key reform for state-owned banks would be to ensure that state-owned bankers have the right incentive structures in place.

Source: Mint January 25, 2018 21:11 UTC