The National Confederation of Bank Employees (NCBE) has demanded that the government abandon policies that lead to privatisation of banks, harm food security and economic benefits a of majority of people in the country, and hamper sustainable development.

In a statement here, the NCBE organising secretary A. Jayakumar, who is also the assistant secretary of All India State Bank of India Staff Federation and general secretary of the State Bank Staff Union (Kerala Circle), said the banking crisis across the world should be a lesson to the country which had mass banking system that had served as a model to the entire world.

He said the nationalisation of banking sector in the country had led to special emphasis on regional development, priority sector advances, and development of the production and service sector. Nationalisation had also helped to spread the banking network in the country, including semi-urban and rural areas, he said.

Though the economic reforms of 1991 emphasised on privatisation, the government had to back out from rapid reforms in banking sector following agitations by employees under the United Forum of Bank Unions, opposition from progressive political movements, and analyses by experts.

The present scenario showed the collapse of a number of banks even in the United States as a result of neo-liberal policies. A major reason for the collapse of the banks was the subjection of banking assets to speculative trade in the aftermath of banking de-regulation, he pointed out. Mr. Jayakumar said banking activities that did not help to create wealth in a country were supposed to lead to the economic crisis.

The move to remove a ceiling set by the Banking Reguation Act 1949 on the voting rights of shareholders of banking companies would lead to privatisation of banks in the country, he said. Observing that banks were deviating from the goals of nationalisation that included wealth creation in rural and semi-urban areas and extension of loan facilities to common people, he said their focus today was transactions centred around the share market.

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