Economy
2018
Banking in India
Fiscal Policy
With reference to the governance of ‘public sector banking in India, consider the following statements:
- Capital infusion into public sector banks by the Government of India has steadily increased in the last decade.
- To put the public sector banks in order, the merger of associate banks with the parent State Bank of India has been affected.
Which of the statements given above is/are correct?
B.2 only
D.Neither 1 nor 2
C.Both 1 and 2
A.1 only
Correct Answer: Option B
Capital infusion into Public Sector Banks (PSBs) by the Government of India has not been a steady process over the last decade. It has fluctuated based on the financial performance and needs of the banks.
To improve the condition of PSBs, a strategy implemented was the merger of associate banks with the parent State Bank of India (SBI). This was aimed at streamlining operations and reducing the burden of Non-Performing Assets (NPAs).
Statement 1 is not correct. Statement 2 is correct.
Hence, only statement 2 is correct.
Sources:
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