Govt will not reduce stake in PSU banks below 51%

Finance Minister P Chidambaram on Tuesday reiterated the government will not bring down its stake in state-owned banks below 51 per cent.

"There is no proposal to reduce government stake in public sector banks, other than associate banks of State Bank of India, to below 51 per cent," Chidambaram said in Rajya Sabha.

While a number of sectors in India have seen a rush of capital, flows into the banking sector have been muted due to RBI's strict regulations, he said.

"There is no rush of capital into the banking system...The flow of capital into banks is strictly regulated by the RBI," Chidambaram said.