Press Statement of All India Insurance Employees Association
ALL INDIA INSURANCE EMPLOYEES’ ASSOCIATION
LIC BUILDINGS, SECRETARIAT ROAD, HYDERABAD, 500004
Email: aiieahyd@gmail.com Phone: 040-23244595
PRESIDENT: DHARMARAJ MOHAPATRA
GENERAL SECRETARY: SHREEKANT MISHRA
PRESS STATEMENT
AIIEA condemns decision to sell majority stake in IDBI Bank
Calls upon Government to abandon Privatisation Proposal
Hyderabad, 15 October 2026
The All India Insurance Employees’ Association (AIIEA) unequivocally condemns the decision taken yesterday by the Cabinet Committee on Economic Affairs (CCEA) to sell 60.72% of the combined equity stake held by the Government of India and the LIC in IDBI Bank to Canada- based Fairfax Financial Holdings for Rs.52,878 crore. According to media reports, the stakes being sold comprises 30.48% held by the Government of India and 30.24% held by the LIC. Following the sale, the Government of India and LIC would retain only 15% and 19% equity stakes in the bank, respectively.
The decision is particularly unfortunate given that IDBI Bank has been registering consistent profitability and demonstrated significant improvement across key financial and operational parameters. The proposed privatisation also raises serious questions about the Government’s commitment to its earlier assurance to Parliament. In 2003, the then Finance Minister of India had assured Parliament that the “Government shall at all times maintain not less than 51% equity holding in IDBI as a banking Company”. The proposed sale represents a clear departure from the spirit of that assurance. The decision also appears to be driven by the government’s determination to meet its disinvestment target of Rs.80,000 crore for the current financial year, rather than by any compelling economic or institutional necessity. The transfer of majority ownership of a strategically important bank to a foreign financial entity is also difficult to reconcile with the ruling party’s repeated assertion of economic nationalism.
AIIEA firmly believes that there was no compelling reason for LIC to reduce its stake in IDBI Bank through such a sale. LIC could have continued as a major shareholder, strengthening the existing partnership between the two institutions and leveraging the potential of bancassurance. Several major banks have successfully combined their banking operations with insurance businesses through subsidiary arrangements. Instead of exploring such possibilities, the Government has chosen to facilitate the transfer of control of a public sector bank to private ownership. This decision is part of the Government’s wider agenda of privatising public sector enterprises and financial institutions, with potentially serious consequences for the interests of ordinary customers, employees and the economy.
The All India Insurance Employees’ Association (AIIEA) extends solidarity to the struggle of the IDBI Bank Officers and Employees and calls upon the Government to drop the proposal of privatising IDBI Bank in the interest of the customers, the economy and the people at large.
Shreekant Mishra
General Secretary