Banking Reforms India
Banking Sector Reforms in India
*Manoj Kumar
Assistant Professor, Deptt. of Commerce,
N.M.Govt. (PG) College, Hansi
ABSTRACT
Banking sector reforms were introduced to remove the deficiencies in banking sector. The lack of autonomy is reflected in the fact that there is a common wage package for all bank employees irrespective of the health of the bank concerned. Kannan, the Chief Executive
Officer of Bank of Baroda, says: "Give us the freedom to fix our own wages and offer market remuneration to professionals. Do not tie us down to a common wage structure. Let each bank decide its appropriate level of wages."
The paper makes an effort to first jot down the major reform measures and policies regarding the banking industry by the government of India and the RBI. Secondly, the paper will try to study the major impacts of those reforms upon the banking industry. These reforms have some positive responds on various economic variables like enhancing the role of market forces, huge decline in the rate of interest, reduction of NPAs, up gradation of technology etc. It has some negative impacts, which decelerate the growth of the economy. It has failed to bring up a banking system at par with international standard and still the banking sector is mainly controlled by the government as public sector being the leader in all spheres of the banking network in the country.
Key words: Liberalization, SLR, CRR, Capital Adequacy, Relationship Banking, NPA.
Spread.
International Research Journal of Commerce Arts and Science http:www.casirj.com Page 272
INTRODUCTION
The financial development was given impetus with the adoption of social control over banks in
1967 and subsequently nationalsation of 14 major scheduled banks in July 1969. Since then the banking system has formed the core of the Indian financial system. In the three decades following the first round of nationalization (the second round consisted of 6 commercial banks in
April, 1980), aggregate deposits of scheduled
*Manoj Kumar
Assistant Professor, Deptt. of Commerce,
N.M.Govt. (PG) College, Hansi
ABSTRACT
Banking sector reforms were introduced to remove the deficiencies in banking sector. The lack of autonomy is reflected in the fact that there is a common wage package for all bank employees irrespective of the health of the bank concerned. Kannan, the Chief Executive
Officer of Bank of Baroda, says: "Give us the freedom to fix our own wages and offer market remuneration to professionals. Do not tie us down to a common wage structure. Let each bank decide its appropriate level of wages."
The paper makes an effort to first jot down the major reform measures and policies regarding the banking industry by the government of India and the RBI. Secondly, the paper will try to study the major impacts of those reforms upon the banking industry. These reforms have some positive responds on various economic variables like enhancing the role of market forces, huge decline in the rate of interest, reduction of NPAs, up gradation of technology etc. It has some negative impacts, which decelerate the growth of the economy. It has failed to bring up a banking system at par with international standard and still the banking sector is mainly controlled by the government as public sector being the leader in all spheres of the banking network in the country.
Key words: Liberalization, SLR, CRR, Capital Adequacy, Relationship Banking, NPA.
Spread.
International Research Journal of Commerce Arts and Science http:www.casirj.com Page 272
INTRODUCTION
The financial development was given impetus with the adoption of social control over banks in
1967 and subsequently nationalsation of 14 major scheduled banks in July 1969. Since then the banking system has formed the core of the Indian financial system. In the three decades following the first round of nationalization (the second round consisted of 6 commercial banks in
April, 1980), aggregate deposits of scheduled
References: 1. Chakraborty, Rajesh. (2006). The Financial Sector in India: Emerging Issues, 156. Oxford University Press. 2. Talwar, S. P. (2003). Competition, Consolidation and Systematic Stability in the Indian Banking Industry (BIS paper no 3. Dhar, P. K. (2002). Indian Economy its Growing Dimensions. Kalyani Publishers. 4. (1991). Committee on Financial System, 30. 6. Kohli, Renu. (2005). Liberalizing Capital Flows: India’s Experience and Policy Issues., Oxford University Press. 7. Ahluwalia, M. S. (2002). Reforming India’s Financial Sector: An Overview. Oxford University Press. 8. Sen, Kunal, & Vaidya, R. R. (1997). The Process of Financial Liberalisation in India. 9. Leeladhar, V. (2005, August). Regulation and Risk Management: Implementing Basel II. RBI Bulletin. 10. Kapila, Raj, & Kapila, Uma. (2000). Ongoing Developments in Banking and Financial Sector, Volume 3. 11. (2010-2011). RBI Annual Report. 12. Banerjee, A. V., & Duflo, E. (2003). Bank Finance in India. MIT: Mimeo. 13. Mukherjee, Parmita. (2003, January-March). Dealing With NPAs: Lessons from International Experiences 14. Mathur, K. B. L. (2002, June 8). Public Sector Banks In India: Should they be privatized?. 15. Sarkar, A., N. (2005). Strategic Business Management and Banking.