Govt takeover of J&K Bank brings PDP, NC and PC on the same page

Governor Satya Pal Malik’s decision to turn J&K Bank Limited into a public sector undertaking and bringing it under the purview of the Right to Information (RTI) Act, the Chief Vigilance Commission (CVC) and State Legislature through the State Finance Department has kicked up a political storm in Kashmir.

All major political parties of the Valley including People’s Democratic Party (PDP), National Conference (NC) and Peoples Conference (PC) besides traders have criticised the government’s move.

Former Jammu and Kashmir Chief Minister Mehbooba Mufti has taken up the governor’s decision with the Finance Minister of India Arun Jaitley. On Wednesday, Mehbooba said that the decision would further alienate the people of Kashmir.

Calling it a “disturbing development”, Omar Abdullah of National Conference told The Indian Express, “caretaker administrator did not have the people’s mandate to take such major decisions with far-reaching implications.”

Chairman Jammu and Kashmir Peoples Conference (PC) Sajad Gani Lone has also rejected recent changes in Jammu and Kashmir Bank saying that "it needs to bereft of Government control not drowned in government control".

The Kashmir Economic Alliance (KEA), a conglomerate of trade unions has asked  Governor Malik to withdraw its decision. The KEA has also threatened a statewide agitation, if the decision was not rolled back.

State Administrative Council (SAC) led by governor Satya Pal Malik and his three advisors on November 22, brought J&K Bank under the purview of RTI, CVC Guidelines, and the state legislature. It also approved the proposal for treating the state’s first listed company as a PSU.

“The SAC approved that the provisions of the Jammu and Kashmir Right to Information Act, 2009 shall be applicable to the J&K Bank Ltd like other PSUs besides the Bank shall follow CVC guidelines,” an official spokesman said. “The J&K Bank Ltd shall be accountable to the State Legislature like other State PSUs.  The Annual Report of the J&K Bank Ltd shall be placed before the State Legislature through the State Finance Department,” he said, maintaining that the state government currently holds 59.3% shareholding and is a major stakeholder, “a need was felt that it should have a character of a PSU which is subject to the general supervision and access for enhanced transparency in the transaction of its business to promote public trust.”

Pertinently, the ‘old generation private sector’ bank, that was established in 1938 and is a publicly listed entity functioning under the supervision of the Reserve Bank of India—has been is plagued with bad loans (gross non-performing assets) worth Rs 175.38 crore, amounting to 11 per cent of all the gross advances.

Governor Malik, had earlier last month exposed a job scam in the bank under the People’s Democratic Party-Bharatiya Janata Party government. He had claimed that the selection list of 528 candidates in J&K was changed to appoint political workers of both the parties.