Why in the News?
- The 55th anniversary of bank nationalisation (1969) has revived debate on its long-term economic impact.
What is Bank Nationalisation
- Transfer of private banks into government ownership
- Objective:
- Align banking with national development goals
- Move control of finance to the public sector
Phases of Nationalisation
Phase 1 (1955)
- Nationalisation of Imperial Bank of India
- Converted into: State Bank of India
Phase 2 (1969)
- 14 major banks nationalised
- Criteria: Deposits ≥ ₹50 crore
- Led by: Indira Gandhi
- Covered about 85–90% of banking sector
Phase 3 (1980)
- 6 more banks nationalised
- Increased state control over banking
Objectives
- Expand banking in Rural and semi-urban areas
- Provide credit to: Agriculture, Small industries, and Weaker sections
- Reduce: Concentration of wealth
- Support: Planned economic development
| [2018] Consider the following events: 1 The first democratically elected communist party government formed in a State in India. 2 India’s then largest bank, ‘Imperial Bank of India’, was renamed ‘State Bank of India’. 3 Air India was nationalised and became the national carrier. 4 Goa became a part of independent India. Which of the following is the correct chronological sequence of the above events? a) 4 – 1 – 2 – 3 b) 3 – 2 – 1 – 4 c) 4 – 2 – 1 – 3 d) 3 – 1 – 2 – 4 |
