RBI Governor hails decision to free banks

MUMBAI: The Reserve Bank of India (RBI) Governor Raghuram Rajan said that the decision of the Government to give freedom to public sector banks (PSBs) to function independently is a land mark decision.

He was speaking at the convocation ceremony of the Indira Gandhi Institute of Development Research (IGIDR) here. The Finance Ministry had issued a direction to banks recently asking them to take decisions without fear or favour and to ignore extraneous considerations in commercial decisions, in the aftermath of the ' Gyan Sangam', which was attended by the Prime Minister Narendra Modi.

Mr. Modi said at the Gyan Sangam, the two-day bankers' meet arranged to discuss banking reforms, that the Government will not interfere in the functioning of public sector banks. He also called for ending "lazy banking" and said that banks must prioritise lending to employment-generating sectors.

Dr. Rajan said that institution plays an important role in the intellectual development of students. While asking students to pay back to the society, Dr. Rajan remembered, institution builders like Dr. Varghese Kurien, who built up a brand like Amul, T. N. Seshan, former Election Commissioner and Vinod Rai, former CAG.

Union Finance Minister Arun Jaitley, who was the Chief Guest at the convocation, congratulated the institute for the gender "reverse disparity" in favour of the women. Over 70 per cent of the students who passed out today were women.