New Delhi, October 30, 2026 (Yes Punjab News)
Finance Minister Nirmala Sitharaman on Friday defended the government’s decision to divest a majority stake in public sector IDBI Bank, accusing previous Congress-led governments of political interference in lending decisions that contributed to a massive accumulation of non-performing assets in public sector banks.
Responding to Leader of the Opposition Rahul Gandhi’s criticism of the proposed IDBI Bank stake sale, Sitharaman alleged that the Congress had treated banks and financial institutions as personal entities and pressured bank employees to extend loans without following prudent lending norms.
“We all know how the Congress has used Banks and financial institutions as personal entities and pressured bank employees to extend loans at their whim, bypassing prudent lending norms,” she said.
In a post on X, the Finance Minister cited historical instances of alleged political interference in banking, including the removal of State Bank of India (SBI) Chairman R.K. Talwar by the Indira Gandhi government in 1976.
“In 1976, Indira Gandhi’s government removed SBI Chairman R.K. Talwar after he refused political pressure to relax lending conditions for a company linked to Sanjay Gandhi’s circle. Sanjay Gandhi pressured the Central Bank of India over loans to Maruti,” Sitharaman wrote.
She also alleged that IDBI Bank had been left in poor financial condition under previous administrations, claiming that it had been compelled to lend to large business groups, including Videocon, Winsome, ABG Shipyard and Kingfisher, which she said had close connections with Congress leaders.
“The IDBI Bank was handed over to us in poor shape, as IDBI itself was forced to lend to large business groups such as Videocon, Winsome, ABG Shipyard and Kingfisher etc with close connections to Congress leaders. These turned into bad loans, causing huge losses for IDBI Bank, which we recognised,” the Finance Minister stated.
Sitharaman said the National Democratic Alliance (NDA) government led by Prime Minister Narendra Modi had revived IDBI Bank through professional management, prudent practices and recapitalisation exceeding Rs 25,000 crore. She added that the bank was now poised to enter its next phase of growth.
“All due process has been followed in the IDBI Bank strategic restructuring, and we have already clarified this yesterday,” she added.
In her series of posts, the Finance Minister cited several banking controversies spanning successive Congress governments, alleging that political leaders had influenced lending decisions and pressured public sector bank employees to sanction loans outside established norms.
“Congress-era banking had a phonebook for the powerful and a rulebook for the common citizens. The era of ‘connection and setting banking’ is over. Common people now have easy access to loans, and employees are not under pressure to extend loans over the phone calls,” Sitharaman wrote.
She also referred to the White Paper on the Indian Economy released in February 2024, saying it documented several instances of alleged scams and economic mismanagement.
“Many more instances of blatant scams and economic mismanagement have been covered in the White Paper on the Indian Economy released in February 2024. It remains relevant even now,” she added.
On October 14, the Centre approved the sale of a 60.72 per cent stake in IDBI Bank to Canada-based Fairfax Financial Holdings for approximately Rs 53,000 crore. The proposed transaction would represent the largest foreign investment in an Indian bank.
Rahul Gandhi had criticised the government’s decision to sell a majority stake in IDBI Bank, arguing that while Congress governments had established banks, the Narendra Modi-led government was selling them.
“I stand with the employees of IDBI Bank,” Gandhi wrote on X, expressing solidarity with the bank’s workforce.
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