India is mulling changes in law to cut govt's stake in banks: Report

The proposals -- if approved -- would allow the government to gradually lower its holding in state-run lenders to 26% from 51% without diluting its grip on management appointments, say sources

India’s government is considering changes that would make it easier to lower its stake in state-run banks, a key step in Prime Minister Narendra Modi’s plan to unclog credit flow to the economy. 

The proposals -- if approved -- would allow the government to gradually lower its holding in state-run lenders to 26% from 51% without diluting its grip on management appointments, the people said, asking not to be identified as the deliberations are private. They would also simplify privatisation of certain identified lenders and permit foreign investors to purchase bigger stakes in others without seeking parliament approval. 

With the