Informist, Thursday, Aug. 14, 2025

By Sagar Sen and Priyasmita Dutta

NEW DELHI – The finance ministry will hold two-day-long deliberations in the first half of September on improving banking services and financial inclusion, a senior ministry official said. The meeting, named 'Manthan', will be chaired by Finance Minister Nirmala Sitharaman along with senior finance ministry officials and the top management of public sector banks, the official told Informist. The two-day event will most likely be held on Sept. 12-13, another person in the know said.

The meeting will be held in Delhi and speakers, including former State Bank of India chairman Arundhati Bhattacharya, may be invited to share their insights on the banking sector. This meeting assumes significance as clouds of uncertainty have surrounded India's external landscape after the US, New Delhi's top export destination, announced 50% tariffs on Indian goods.

In 2024-25 (Apr-Mar), India exported $86.51 billion worth of goods to the US and had a trade surplus of $40.82 billion. In the current year, the additional tariff on nearly 55% of exports to the US poses a risk to almost $50 billion of Indian goods from labour-intensive sectors such as chemicals and fertilisers, textiles and apparel, gems and jewellery, shrimp and seafood, furniture and bedding, and machinery and mechanical appliances, among others.

Since US President Donald Trump's tariff announcement, Indian exporters have been clamouring for financial support to tackle the situation and help them diversify markets.

During the meeting, public sector banks' financial performance for the first quarter of FY26 may also be reviewed, the official said. Collectively, the 12 public sector banks, including SBI, reported a net profit of INR 442 billion in Apr-Jun, up 10.6% on year. Public-sector banks collectively posted a record net profit of INR 1.78 trillion for FY25, up 26%.

Sitharaman may also push public-sector banks to lend in a big way after the Reserve Bank of India's cumulative 100-basis-point rate cut in 2025 so far, the official said. At a review meeting in June, the finance minister had asked state-owned banks to maintain the credit growth momentum seen in FY25. For the first time since 2011, public-sector banks surpassed private-sector banks in terms of loan growth in FY25. Banks may also be asked to work on ways to ensure lower non-performing asset levels in the future.

Previously, the finance ministry had organised a similar event in 2016 and had called it 'Gyan Sangam'. During the two-day event, separate groups were formed to brainstorm on banks' non-performing asset management, restructuring (mergers and acquisitions), credit growth, technology and risk management. After the meeting, former finance minister Arun Jaitley had said that bankers had supported the proposal of consolidation in order to have strong banks rather than having a numerically large number of banks.

Following up on the key takeaway from the event, the Narendra Modi government had carried out mammoth PSU bank mergers since 2017. The process was kickstarted by merging five associate banks of State Bank of India--State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Travancore, State Bank of Hyderabad and State Bank of Patiala-- along with Bharatiya Mahila Bank into State Bank of India in 2017.

Thereafter, the government in August 2019 announced a mega-merger plan for 10 public sector banks. Effective Apr. 1, 2020, Oriental Bank of Commerce and United Bank of India were merged into Punjab National Bank, Andhra Bank and Corporation Bank were merged into Union Bank of India, Syndicate Bank was merged with Canara Bank and Allahabad Bank was merged into Indian Bank. End

Edited by Tanima Banerjee

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.