‘Developed India’ needs more big, world-class banks: FM

Mumbai: Finance Minister Nirmala Sitharaman address the gathering during the 12th SBI Banking and Economics Conclave 2025, in Mumbai, Thursday, Nov. 6, 2025.
| Photo Credit:
PTI

The Indian government aims to develop multiple large, globally competitive banks, according to Union Finance Minister Nirmala Sitharaman. She emphasized that authorities will collaborate with the Reserve Bank of India and banking institutions to achieve this objective.

This statement aligns with national aspirations to become a developed economy by 2047. Responding to queries about banking consolidation at SBI’s 12th Banking and Economic Conclave, Sitharaman stated, “We’ll engage with both RBI and banks to determine the best path forward.

The Finance Minister clarified that any decisions will consider the banking regulator’s perspective, noting that creating larger institutions isn’t limited to merging existing entities. “We require a robust ecosystem that enables banks to expand organically. Significant groundwork is already underway to enhance this environment,” she added.

Currently, only State Bank of India (ranked 43rd) and HDFC Bank (73rd) feature among the world’s top 100 banks by assets in S&P Global Market Intelligence’s rankings. Sitharaman previously advocated for four to five SBI-sized institutions during her 2021 address to the Indian Banks’ Association, citing economic scaling needs before and after the pandemic.

Derivatives Market Regulation

Regarding derivatives trading, the Finance Minister clarified the government isn’t seeking to restrict futures and options markets but stressed investor education about risks. “Market participants must understand their responsibilities when dealing with complex financial instruments,” she emphasized.

GST Restructuring Impact

Sitharaman highlighted the September 2025 GST rationalization as initiating a significant economic virtuous cycle. “This reform could substantially accelerate our growth trajectory if momentum continues,” she observed.

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Published on November 6, 2025