Union Finance Minister Nirmala Sitharaman on Friday defended the NDA government’s decision to divest its stake in IDBI Bank, while accusing successive Congress-led governments of political interference
in banking operations and financial mismanagement.
Her remarks followed criticism from Leader of Opposition Rahul Gandhi over the proposed sale of a controlling stake in the public sector lender to a subsidiary of Canada’s Fairfax Financial Holdings.
In a post on X, Sitharaman referred to several controversies spanning different Congress administrations, alleging that political leaders had influenced lending decisions and pressured public sector bank employees to extend loans without following established norms.
The Finance Minister also alleged that IDBI Bank had been compelled to lend to large business groups with links to Congress leaders, including Videocon, Winsome, ABG Shipyard and Kingfisher. These loans later turned into bad debts, resulting in substantial losses for the lender, she said.
We all know how @INCIndia has used Banks and financial institutions as personal entities and pressured bank employees to extend loans at their whim, bypassing prudent lending norms.
Let me list a few instances.
– In 1957, Haridas Mundra got money from LIC due to influence by the Congress leaders.
– In 1976, Indira Gandhi’s government removed SBI Chairman R.K. Talwar after he refused political pressure to relax lending conditions for a company linked to Sanjay Gandhi’s circle.
– Sanjay Gandhi pressured the Central Bank of India over loans to Maruti.
– B. Janardhana Poojary, MoS Finance under Indira Gandhi and Rajiv Gandhi — pressured bank employees to issue loans in the 1980s.
– Pawan Kumar Bansal, as a minister in the UPA, pressured Canara Bank to give loans to his family-linked businesses.
The IDBI Bank was handed over to us in poor shape, as IDBI itself was forced to lend to large business groups with close connections to @INCIndia leaders such as Videocon, Winsome, ABG Shipyard, Kingfisher, etc. These turned into bad loans, causing huge losses for IDBI Bank, which we recognised.
The NDA govt led by Hon’ble PM Shri @narendramodi revived the IDBI bank through professionalism, prudence and recapitalisation of more than Rs 25,000 crores. The IDBI Bank is now poised for its next phase of growth.
All due process has been followed in the IDBI Bank strategic restructuring, and we have already clarified this yesterday.
Check this: https://t.co/EjAOziADyf
Many more instances of blatant scams and economic mismanagement have been covered in the White Paper on the Indian Economy released in February 2024. It remains relevant even now.
Read here: https://t.co/MojSe36Zb2
Your lies with respect to Rafale had failed and were exposed. You had to apologise. The same will happen here.
Congress-era banking had a phonebook for the powerful and a rulebook for the common citizens.
The era of ‘connection and setting banking’ is over.Common people now have easy access to loans, and employees are not under pressure to extend loans over the phone calls.
— Nirmala Sitharaman (@nsitharaman) October 30, 2026
“The IDBI Bank was handed over to us in poor shape, as IDBI itself was forced to lend to large business groups with close connections to @INCIndia leaders such as Videocon, Winsome, ABG Shipyard, Kingfisher, etc. These turned into bad loans, causing huge losses for IDBI Bank, which we recognised,” she added.
Sitharaman Says NDA Revived IDBI Bank With Rs 25,000 Crore Recapitalisation
Defending the government’s record, Sitharaman said the NDA government, led by Prime Minister Narendra Modi, had worked to revive IDBI Bank through professional management, prudent practices and recapitalisation exceeding Rs 25,000 crore.
“The NDA govt led by Hon’ble PM Shri @narendramodi revived the IDBI Bank through professionalism, prudence and recapitalisation of more than Rs 25,000 crores. The IDBI Bank is now poised for its next phase of growth. All due process has been followed in the IDBI Bank strategic restructuring, and we have already clarified this yesterday,” she added.
The Finance Minister also maintained that the strategic restructuring had followed the prescribed procedures, including independent valuations and bidding protocols under the Core Group of Secretaries on Disinvestment (CGD).
According to the Ministry’s statement, the initial bidding round in FY 2025–26 was conducted in accordance with the Department of Investment and Public Asset Management (DIPAM) indicative guidelines, with procedural flexibility provided for complex transactions.
The reserve price was kept unchanged in the second round, while the revised process helped increase the discovered bid price by Rs 3,917 crore. The bank’s assets and business were independently valued using recognised methods, including comparable company multiples based on listed public sector banks.
Sitharaman also referred to the White Paper on the Indian Economy, released in February 2024, saying it documented several instances of alleged scams and economic mismanagement under previous governments.
“Congress-era banking had a phonebook for the powerful and a rulebook for the common citizens. The era of ‘connection and setting banking’ is over,” she said.
She further rejected the Congress’s criticism, referring to the party’s allegations over the Rafale deal and asserting that the same would happen in the current controversy.
“Many more instances of blatant scams and economic mismanagement have been covered in the White Paper on the Indian Economy released in February 2024. It remains relevant even now. Your lies with respect to Rafale had failed and were exposed. You had to apologise. The same will happen here. Common people now have easy access to loans, and employees are not under pressure to extend loans over phone calls,” she added.
What Did Rahul Gandhi Say About IDBI Bank Sale?
Earlier, Rahul Gandhi criticised the Centre’s decision to sell a controlling stake in IDBI Bank, accusing the government of dismantling public sector institutions established during the Congress era.
“During Congress’s time, IDBI was established—to build the nation’s industry. During Modi’s time, first the bidding was seen, then the price was set. During Congress’s time, banks were being created. During Modi’s time, they are being sold,” Gandhi wrote in a post on X.
In a letter addressed to IDBI Bank employees, the Congress leader also raised concerns over the impact of the proposed privatisation on reservation policies and service conditions.
“When IDBI is privately owned, reservation for SC, ST and OBC candidates will go with it. Your service conditions, already weakened, will lose their last protection. The Congress has always believed in a strong public sector working alongside the private sector. Public banks are not assets to be sold off, they are tools to build the nation,” he cautioned.
Gandhi also extended his support to the bank’s employees, who have opposed the proposed sale.
IDBI Bank Disinvestment: What Is The Deal?
The Union Cabinet approved the Rs 52,878-crore (USD 5.56 billion) transaction on October 14, clearing the sale of a combined 60.72% stake in IDBI Bank held by the Centre and the Life Insurance Corporation of India (LIC).
Under the proposed deal, the government will divest its 30.48% stake, while LIC will sell its 30.24% holding. After the transaction, the Centre’s shareholding in the bank will decline to 15%, while LIC’s stake will come down to 19%.
