The need for the nationalisation was felt mainly because private commercial banks were not fulfilling the social and developmental goals of banking which are so essential for any industrialising country.
Fifty years ago, on July 19, 1969 14 major private banks were nationalised in India. Nationalisation took place in two phases, with the first round covering 14 banks followed by another in 1980 covering 7 banks. The official view today is that it is time to rethink and reverse that decision in order to resolve a crisis overwhelming the public banking system.
Was nationalisation a mistake in the first place? Or was it unavoidable?
We discuss this issue in this episode of Money Matters with expert inputs from renowned economist Prabhat Patnaik, CH Venkatachalam, General Secretary, AIBEA, Thomas Franco, Former General Secretary, AIBOC.