IMF warns India over public sector banks, advocates privatisation

The International Monetary Fund (IMF) has cautioned India against macro-financial risks which emerged from the government ownership of the public sector banks and suggested to the country that it should consider privatisation of these lenders.

In its review of India under Article IV,  IMF also flagged external vulnerabilities on rising import bill, particularly from increasing oil prices and global protectionist measures.

The review done by executive directors of IMF said systemic macro-financial risks persist, as the weak credit cycle could impair growth and the sovereign-bank nexus has created vulnerabilities.

IMF underscored the importance of a comprehensive plan to improve the