Nearly 300,000 employees of Indian state-run banks went on strike on Tuesday against government plans to consolidate the sector through mergers as part of efforts to ensure stronger balance sheets.
Prime Minister Narendra Modi’s government has vowed to cut the total number of state-owned banks to 12, from 27 in 2017, raising fears of job losses. Under the current round of squeezing, 10 banks will be amalgamated into four.
“Government may call it a merger but in reality it is cold-blooded murder of six banks,” a release by the bank unions said.
The state-owned banks account for nearly two-thirds of banking assets in the country and also have a lion’s share in the nearly $150 billion of soured loans in the banking sector.
The sector suffered from out-of-control lending in 2006-11 when the economy grew rapidly, and has continued to struggle.
Employees stayed away from work across the country and joined in protest marches. Services such as cash deposits and withdrawals, cheque clearances, ATM operations were affected, according to bank employees.
C H Venkatachalam, general secretary of the All India Bank Employees Association (AIBEA), said the plan was to expand the protest movement to other bank employees as well, taking it up to nearly a million workers to force the government to reconsider its decision.
A senior banker, however, said the protests would not derail the merger plans.
“We have seen that the unions had taken similar steps even in the last round of merger which included the State Bank of India and then in the case of Bank of Baroda but it quietly died down later,” said the chief executive officer of a public sector bank, requesting anonymity.