The Hindu Business Line

‘Ex­plore PPP model in PSBs’


The gov­ern­ment could ex­plore the pub­lic-pri­vate part­ner­ship (PPP) ar­range­ment for pub­lic sec­tor banks, by in­duct­ing a pri­vate sec­tor bank as a strate­gic part­ner in the for­mer in a trans­par­ent man­ner. In an an­nex­ure to a doc­u­ment pre­pared by the Fi­nance Min­istry, Uday Ko­tak, MD and CEO, Ko­tak Mahin­dra Bank, sug­gested that the strate­gic part­ner could hold a 26 per cent stake in the PSB and the gov­ern­ment could cap its hold­ing at be­low 40 per cent, with the ag­gre­gate hold­ing of the two en­ti­ties be­ing be­low 65 per cent.

“De­ploy­ment of tal­ent from pri­vate sec­tor at arm’s length into the above joint ven­ture, com­bined with best of the gov­er­nance prac­tices, should be a part of the con­di­tions.

“This PPP model has the op­por­tu­nity of bring­ing the best of pro­cesses of pub­lic sec­tor with en­ter­prise of the pri­vate sec­tor and can lead to dra­matic re-rat­ing of the value of gov­ern­ment own­er­ship go­ing for­ward,” said Ko­tak in his sug­ges­tion ti­tled, ‘Out of the Box’.

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