Rahul Gandhi, the Leader of the Opposition in the Lok Sabha, wrote to IDBI Bank employees on Thursday, 29 October, saying he stands with them in their fight against the privatisation of the bank. The Union Cabinet approved the sale on 14 October. Under the deal, a subsidiary of Canada's Fairfax Financial Holdings will buy a 60.72% controlling stake for about ₹52,878 crore, of which 30.48% is held by the government and 30.24% by Life Insurance Corporation. The United Forum of IDBI Officers and Employees has announced a two-day nationwide hunger strike on 2 and 3 November, and the union has warned of an indefinite strike if its demands are not met.
Gandhi's letter makes a case that many staff will find familiar. He said the bank was losing money seven years ago but earned a profit of more than ₹9,000 crore last year, and he asked why a bank that has turned around should be sold. He recalled a government assurance given to Parliament in 2003 that it would keep at least 51% ownership, and he pointed out that combined government and LIC ownership will fall from 95% to 34%. He also warned that reservation for SC, ST and OBC candidates will go once the bank is privately owned, and that the staff's service conditions will lose their last protection. Gandhi added that employees met him at Parliament House in March 2025 and that he raised the issue in the Lok Sabha. The employees' forum is asking the Centre to buy at least 6% more equity to hold 51%, and it wants legally binding written assurances on pay, pensions and reservation.
The government has answered some of these points. According to ANI, Arunish Chawla, the secretary of the Department of Investment and Public Asset Management, said the share purchase agreement states that the existing employees' service conditions will remain unchanged and that a separate pension fund has been created for current pensioners. He said two independent valuers used separate methods and that only 5.3% of the bank's shares trade in the market, with the price ranging from ₹61 to ₹118 over the previous six to eight months. The Federal reported that Fairfax will pay ₹81 a share against a benchmark of ₹75.99, and that IDBI shares rose 9.07% to close at ₹90.44 on the day of the announcement. The bank was also under the Reserve Bank's Prompt Corrective Action framework from 5 May 2017 until 10 March 2021, which is the backdrop to the sale.
The outcome matters for the public-sector banking system as a whole. The terms may set a template for how later sales are handled, including how reservation and pension rights are protected. The sale needs approval from the Reserve Bank, which will assess whether the buyer is fit and proper, the Competition Commission and other regulators, and an open offer must be made to public shareholders unless the market regulator waives it. According to The Federal, promoters may hold no more than 26% under Reserve Bank norms with up to 15 years to comply, the new owner must keep the IDBI name and customer relationships for at least three years, and the government leaves the board once the deal closes. Completion is expected before the end of the 2026-27 financial year. Whatever the final terms, a labour dispute at a bank with branches across the country can affect customers in the weeks ahead, which is why the strike dates will be watched closely.
The sale will probably go ahead, because the government has set its price and its timetable. The remaining question is whether written, enforceable guarantees on jobs and reservation can be put in place before the deal closes, since the staff will continue to press for exactly that.
Leave a Reply