Government to halt IDBI Bank sale, order JPC probe: Congress

Congress, alleging serious irregularities in the sale of the public sector IDBI Bank, has demanded that the central government immediately halt the deal, have the entire matter investigated by a Joint Parliamentary Committee (JPC), and make public the reports on the bank's valuation.

Congress spokesperson and former Rajya Sabha MP Shakti Singh Goyal said on Tuesday at a press conference at the party headquarters here that the central government is selling IDBI Bank to Canadian company FairFax Financial Holdings, raising several serious questions about the deal.

He alleged that statements by representatives of the company buying the bank indicate that IDBI Bank's own funds could be used to pay for the acquisition.

Mr. Goyal said that the purpose of establishing public sector institutions was to make the country's resources and facilities accessible to common citizens. Pandit Jawaharlal Nehru initiated the public sector institutions, and IDBI Bank was established on July 1, 1964, during the tenure of former Prime Minister Lal Bahadur Shastri, to provide credit to small traders and micro and small industries and to promote industrial growth and employment.

He said that IDBI Bank has earned a total profit of 30,105 crore rupees between 2021 and 2026. The bank made a profit of 1,359 crore rupees in 2021, 2,439 crore rupees in 2022, 3,645 crore rupees in 2023, 5,634 crore rupees in 2024, 7,515 crore rupees in 2025, and 9,513 crore rupees in 2026. He questioned why a consistently profitable bank is being handed over to a foreign company.

Mr. Goyal alleged that the central government has decided to sell its 62.72 percent stake in IDBI Bank, including its shares in the Life Insurance Corporation of India (LIC), to FairFax Financial Holdings for 52,878 crore rupees. He said that as a result of this deal, control of the bank will end, and it will also lose its status as a public sector institution. Raising questions about the valuation process, he said that the price of one share of the bank was initially set at 94.42 rupees, but after the bid was opened, it was changed to 75 rupees per share. He alleged that changing the valuation after the bid was opened is against the rules. He demanded that the government make both valuation reports public and disclose details of the second bidder.

He said that in 2003, then Finance Minister Jaswant Singh had assured Parliament that the government's stake in IDBI Bank would not fall below 51 percent.

He alleged that the current government is working against this assurance. In this regard, he also showed a video of the statement made by the then Finance Minister in Parliament during the press conference. He also raised the question of why a company holding control in one bank was given a waiver in acquiring control in another bank under the rules of the Reserve Bank of India. He said the government should clarify where and how the foreign company will obtain the funds to buy IDBI Bank and why it has been given the facility to reduce its stake in another bank within two years.

Mr. Gohil alleged that the sale of the bank raises several questions about its assets and the benefits derived from the bank as a government sector entity. He said that if the bank exits the government sector, employment opportunities available for listed castes, listed tribes, other backward classes, persons with disabilities and women could be affected. He demanded transparency from the government regarding the value of the bank’s assets and their future. He said that in the Lok Sabha, opposition leader Rahul Gandhi had earlier met representatives of IDBI Bank employees and opposed the sale of the bank to a foreign company, asking questions of the government in that regard. Mr. Gohil alleged that the government has not provided satisfactory answers to those questions.

During this time, Congress communication head J. Ram Ramesh said on the social media platform X that a foreign company is buying IDBI Bank with the bank’s money from the government. He called it another big scam of the Modi government, demanding that the sale of IDBI Bank be stopped immediately, that the entire case be examined by a joint parliamentary committee for irregularities, and that both reports on valuation be made public. After the party opened the bidding, it also demanded that the reasons for changes in the bank’s valuation, details of other bidders, and information on how the foreign company is raising funds for the purchase be made public.