This refers to the editorial "RBI's welcome conservatism" (April 5). Banking in India is a sensitive and lucrative business. Sensitive, because the failure of even one bank can shake the confidence of investors. And, lucrative because an estimated 40 per cent of Indian pockets remains outside banks. The Reserve Bank of India has acted in the best interests of the country by refusing to budge under pressure from many quarters, including the industrial houses. India has adopted a mixed pattern of economic development where both private and public players have an equal role in the country's development. Another point that cannot be overlooked is that many new-generation private banks that emerged as a product of liberalisation have redefined banking and customer service in a big way. Their public sector counterparts, despite long-standing presence in the system, have many new things to learn. Thus, granting new banking licences to more private players in a systematic manner will automatically help public sector banks deliver more efficiently.
Srinivasan Umashankar Nagpur
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