NEW DELHI: Finance Minister Nirmala Sitharaman on Wednesday said the Cabinet had given its nod to the process of merging some 10 state-run banks into four banks and also approved a proposal to allow direct listing of Indian companies overseas.
The approval of bank mergers is an ongoing process of amalgamation of Public Sector Banks and the mergers would come into effect from April 1, 2020.
The minister said the government had been in regular communication with banks and she did not foresee any regulatory issues in effecting the mergers.
“The banks’ merger is on course and decisions have already been taken by the respective bank boards,” she told reporters in Delhi.
Meanwhile, the bank employees union and officers association called a strike on March 27, seeking a cancellation of the proposed merger.
Meanwhile, the Cabinet also approved a proposal to allow direct listing of Indian companies overseas. According to the corporate affairs ministry, amendment would be carried out in Section 23 of the act to include enabling provisions to allow direct listing of securities by Indian public companies in permissible foreign jurisdictions.
Currently, quite a few Indian companies have American Depository Receipts (ADRs) and some other corporates have their Global Depository Receipts (GDRs).
Apart from providing an additional fundraising avenue for the corporates looking to expand and boost their business activities, overseas listing of shares would also help in bringing more capital into the country.