Government panel to review India's banking sector strategy for Viksit Bharat. A high-level committee is examining bank consolidation, foreign investor voting caps currently set at 26 percent, and potential conversion of large NBFCs into banks. Experts believe larger banking institutions are necessary to support domestic growth and reduce reliance on foreign funding. Long-term strategic equity investments from credible foreign players are viewed as positive for the banking system, providing patient capital without adverse effects. The panel will also assess public sector bank consolidation, with outcomes dependent on efficiency improvements rather than a predetermined optimal number of lenders. These structural decisions will ultimately rest with regulators and government authorities.
