Arunish Chawla, Secretary of the Department of Investment and Public Asset Management (DIPAM), has provided assurances regarding the future of IDBI Bank employees and pensioners amidst the ongoing strategic restructuring of the lender. Chawla stated that all existing employees' service conditions would be fully safeguarded, and pensioners' benefits would also be protected through a dedicated pension fund already set aside for this purpose.
Speaking in an interview, Secretary Chawla addressed widespread concerns from bank unions and IDBI Bank employees regarding the government's decision to divest a 60.72% stake in the institution. He emphasized that the bank is being strategically restructured as a "going concern" and will continue to operate as a board-run company, with management maintaining negotiations with its workforce.
Strategic Sale Progresses Despite Union Opposition
The transaction, which involves the sale of a controlling stake, is expected to be completed within the current fiscal year, pending crucial clearance from the Reserve Bank of India (RBI) for the prospective bidder, Fairfax Financial Holdings. Chawla reiterated that the strategic restructuring of Central Public Sector Enterprises (CPSEs) is a continuous process, and the existing pipeline of stake sales will be brought to its logical conclusion.
However, the proposed strategic sale has met with significant resistance from various banking and insurance employee unions. The United Forum of IDBI Bank Officers and Employees, along soon after the Union Cabinet's approval, called for a review, demanding evidence that the "national asset is not being transferred at a throwaway price."
Unions Voice Concerns Over Privatization
Similarly, the United Forum of Bank Unions (UFBU), which claims to represent 90% of the banking workforce across seven bank unions, has vehemently opposed the move. The UFBU has described the divestment as not merely "privatisation" but also "foreignisation," expressing strong disapproval of the government's decision to sell the majority stake. In protest, the UFBU asked its members to wear black badges on October 16.