Union Finance Minister, Mr Pranab Mukherjee, said that the Government cannot allow commercial activities of banks to be supervised by representatives of people. Mr. Mukherjee was speaking in the Lok Sabha.
The statement was in response to a question raised by MP Mr Jagdish Sharma on priority sector lending by banks. Mr Sharma sought to know about banks that failed to achieve priority sector lending targets. He also suggested an increase in the target from the current level of 40 per cent for public sector banks as well as some form of supervision/monitoring by representatives of people.
The FMruled out an increase in priority sector lending target and stated that the Government cannot allow commercial activities of banks to be supervised by representatives of people. Mr Mukherjee highlighted the fact that the Committee on public undertakings (COPU) was already looking into such matters.
As of March 2009, 24 27 public sector banks and 17 of the 22 private sector banks had achieved the stipulated 40 per cent target.
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