Union Finance Minister Arun Jaitely said that the government will soon announce a series of major banking reforms, including lowering its stake in state-owned banks to 51 per cent. Jaitely said “Public sector banks have played an important role in financial inclusion but at the same time, political government needs to maintain arm’s-length distance from these banks and allow them to have more professionalised bank boards. The banks will have to work on banking considerations”.

In the quarter to December 2015 alone, nine state-owned banks have reported a combined loss of Rs 11,251 crore, with Bank of Baroda posting a quarterly net loss of Rs 3,342 crore. Apart from banking reforms, Jaitley also said that the government is trying to bring in more clarity on tax norms and resolve tax issues to give a “stable and predictable” tax regime.

The Finance Minister also said that the government is committed to bringing down direct corporate tax rates over the next four years. He said that the government is diverting the windfall from falling oil prices to infrastructure, railways and rural roads.