Big bank theory

The track record of this government has given us enough reason to be sceptical about another experiment with merging PSBs

Financial markets often use a term “big-bang reforms”, something that they want the Indian government to unleash. There is no clear definition of this term but we can draw upon Potter Stewart’s (Associate Justice of the US Supreme Court) test of obscenity: “I know it when I see it.” Last Friday, Finance Minister Nirmala Sitharaman announced another round of mergers of select public sector banks (PSBs). Many people feel this is what big-bang reforms look like, wistfully recalling the heady days of 1991. Does it? The test for big-bang reforms is two-fold: Something that is immediately and very positively impactful