IDBI officers’ forum opposes majority stake sale to Fairfax, demands review
Mumbai: Hours after the Union cabinet on Wednesday approved the sale of the government’s 60.72% stake in IDBI Bank to Fairfax Financial Holdings, the United Forum of IDBI Officers and Employees said that it strongly opposes the Centre’s decision to sell a controlling stake in the bank to a foreign entity.
The forum has kept a demand for an immediate suspension of further steps towards the transaction and a comprehensive review through parliamentary scrutiny and stakeholder consultation.
On Wednesday, the Union cabinet approved the strategic restructuring of IDBI Bank, with the government set to sell a 60.72% stake in the lender to Fairfax Financial Holdings for ₹52,877 crore. Prime Minister Narendra Modi-led Cabinet Committee on Economic Affairs approved the Canadian entity as the strategic buyer.
The government and Life Insurance Corporation of India will jointly retain a 34% stake in the restructured entity, Union minister Ashwini Vaishnaw said.
Forum’s concerns
The proposed sale raised concerns over public ownership, financial sovereignty, asset valuation and the future of the bank’s social obligations, the forum said in a statement. It called on the government to disclose the transaction’s valuation methodology, terms and findings of due diligence on the proposed purchaser.
“Financial self-reliance requires the capacity to direct credit towards national development and social priorities. Surrendering control over an institution with IDBI’s legacy undermines that objective,” the forum said.
Questioning the rationale behind the decision, the employees’ body said it was contradictory for a government committed to Atmanirbhar Bharat (self-reliant India) to transfer control of an institution with IDBI’s history to foreign capital.
The forum also raised concerns that the transaction could undervalue the bank’s properties, institutional capabilities, customer relationships and future earnings. It demanded disclosure of the assumptions underlying the valuation, the treatment of real estate and other assets, and the basis for accepting the sale consideration.
“The public deserves evidence that a national asset is not being transferred at a throwaway price,” it said.
The proposed purchaser’s ownership structure, financial strength and regulatory record should also be subjected to transparent scrutiny, the forum said, adding that regulatory approval could not replace public accountability in the transfer of control of a major Indian bank.
Established in 1964, IDBI played a pioneering role in financing India’s industrial development, supporting infrastructure and shaping the country’s financial architecture, the forum said. Its contribution could not be measured merely by the proceeds of a share sale.
Invoking a parliamentary assurance associated with IDBI’s conversion into a banking company, the forum said the government owed Parliament and the public an explanation of how the proposed transaction squared with the commitment attributed to then Union finance minister Jaswant Singh that government shareholding would remain at least 51%.
The forum further cautioned against any dilution of reservation safeguards, employment security, financial inclusion and development-oriented lending.
Forum’s demands
Among its demands are a suspension of further steps towards transferring ownership and management control, parliamentary scrutiny, meaningful stakeholder consultation and enforceable protections for employees, customers and minority shareholders.
“This is a struggle to defend an institution, its social obligations and the country’s prestige and pride,” the forum said, adding that it would mobilize employees and the public through democratic action and approach the judiciary for appropriate relief.
The statement was issued by Devidas Tuljapurkar, convener, and Vithal Koteshwarrao, joint convener, of the forum.
The sale of the lender was first announced in 2022 but has dragged on since then due to regulatory and procedural issues. It was shelved in March as bids fell short of the government’s expected sale price.
The transaction marks the biggest disinvestment by the Union government since Air India, according to a PTI report. IDBI Bank recorded a net profit of ₹9,513 crore in the fiscal year 2025-26. Established in 1964 as a development financial institution, it transitioned into a commercial bank in 2004.
