With reference to the governance of public sector banking in India, consider the following statements : 1. Capital infusion into public sector banks by the Government of India has steadily increased in the last decade. 2. To put the public sector banks in order, the merger of associate banks with the parent State Bank of India has been affected. Which of the statements given above is/are correct ?
- (a) 1 only
- (b) 2 only ✓ UPSC's answer
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Why the answer is (b)
• Statement 2 is correct: in April 2017 the five associate banks (SBBJ, SBH, SBM, SBP, SBT) and Bharatiya Mahila Bank were merged into SBI to strengthen and consolidate public sector banking.
• Statement 1 is wrong: capital infusion has fluctuated, not steadily increased — small amounts in the early 2010s, then a large ₹2.11 lakh crore recapitalisation announced in 2017 and tapering after 2021.
• Hence 2 only, option (b).
Why the other options are wrong
- (a) 1 only
- Statement 1 is wrong: infusion has not risen steadily.
- (c) Both 1 and 2
- Statement 1 is wrong.
- (d) Neither 1 nor 2
- Statement 2 is correct: the SBI merger happened in 2017.
Asked in the GS Paper I of the UPSC Civil Services Preliminary Examination 2018, held on 3 June 2018. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.