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Friday 5 June 2020

Sitharaman: Delhi riots over CAA had no effect on investors

The finance minister dealt also with the issue of mergers of public-sector banks and the question of whether the government had decided to demonetise Rs 2,000 notes

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Investors’ stance has not been affected by the protests across the country and the violence in Delhi in protest against the Citizenship Amendment Act (CAA) and domestic and foreign investors are still excited about investing in India. Union Finance Minister Nirmala Sitharaman said on Thursday.

Speaking to the media in Guwahati, she said that the investors she had met during her recent visit to Saudi Arabia had expressed a desire to invest more in the country.

When asked about the Delhi violence in the name of protesting against the Citizenship Amendment Act (CAA), Sitharaman said she had not observed any difference in the sentiments of foreign investors.

On the possible impact of coronavirus on industry and economy, the finance minister said that there is nothing like that now. She added, however, if the situation did not improve in the next two months, there might be a shortage of raw materials.

The finance minister said that we are working to address the issue of the pandemic and help the industry.

Sitharaman: No uncertainty over bank mergers

On the proposed merger of public sector banks (PSU Bank), the finance minister said that the process was proceeding as per schedule. The government has decided to form four big banks by combining 10 government banks. The finance minister said that there was no uncertainty about the bank merger.

Sitharaman said had reached the venue for the press conference from a review meeting with the heads of public sector banks.

In August 2019, the government had decided to merge 10 big state-owned banks into four banks. United Bank of India and Oriental Bank of Commerce will merge with Punjab National Bank.

PNB will be the second-largest bank after the merger. In addition, Syndicate Bank will be merged with Canara Bank and Allahabad Bank with Indian Bank. Andhra Bank and Corporation Bank will merge with Union Bank of India.

‘No instruction to banks to phase out Rs 2,000 notes’

Reporters on the finance beat asked Sitharaman if her ministry had asked banks not to push Rs 2,000 notes through ATMs. She said the ministry had not issued any instruction to banks in this regard. “As far as I know, no such instruction has been given.”

The question arose as banks, it was noticed, had started dispensing Rs 500 notes more than Rs 2,000 denomination notes. Market observers speculated that this was a move for a gradual phasing out of the high-denomination currency note.

The finance minister’s statement notwithstanding, Indian Bank has announced that it will stop dispensing Rs 2,000 notes through its ATMs.

The Reserve Bank of India had said through an RTI response last year that the central bank had stopped printing Rs 2,000 denomination currency notes.

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