Rajya Sabha session extended for passing Banking Bill

NEW DELHI: Rajya Sabha will on Thursday take up the bill to amend banking laws, which was passed by the Lok Sabha on Tuesday. The Upper House was to adjourn sine die, but its sitting has been extended by a day to pass the bill. Finance minister P Chidambaram was determined to ensure passage of the bill to amend the banking laws, which had hit a hurdle with BJP saying it will not support it as government had included a new clause allowing banks to trade in commodity futures trading. However, BJP agreed to back the legislation after Chidambaram announced in the Lok Sabha on Tuesday that the contentious clause would be dropped The winter session of Parliament comes to an end on Thursday. However, the government could not take up other pro-reform legislations in the financial sector — opening up FDI in pension sector and raising FDI cap in insurance — in the session.

The Banking Law (amendment) Bill paves the way for RBI to issue new banking licenses and also seeks to raise voting rights of investors in private sector banks from 10% to 26%.

It allows the Reserve Bank of India (RBI) to supercede boards of private sector banks and increase the cap on voting rights of private investors in public sector banks from 1% to 10%. The Lok Sabha had also passed the Companies Bill, which seeks to improve the quality of corporate governance by strengthening the hand of the Serious Fraud Investigation Office, late on Tuesday.