Chief Economic Advisor Krishnamurthy V Subramanian said that while China has 18 banks, the US has 12 banks in the global top 100, there are countries “that are a fraction of our (economy) size (but) have far more banks in the global top 100."
Chief Economic Advisor (CEA) Krishnamurthy V Subramanian on Sunday urged the Indian banking sector to perform like now-retired Mahendra Singh Dhoni’s team which “went and achieved success everywhere in the world” instead of the 1990s team which was “tigers at home but lambs abroad”. Addressing the Bandhan Bank’s Anniversary Lecture via video conference, the CEA drew parallels between the Indian banking sector and the Indian cricket team to put in perspective the former’s significance in the global banking context and the need for a mindset change. Subramanian said that while the Indian banking sector has seen significant success over the past 40-50-years in the country but the number of Indian banks in the global top 100 is not “proportional to the size of the economy.”
Citing data from the Economic Survey 2019-20, Subramanian said that despite being the fifth largest economy in the world, India has only one bank – State Bank of India and that too at 55th position – in the global top 100 last year. “We used to win left right and center on tailor-made pitches in India but when we went abroad, we used to be found really wanting,” he added comparing the current situation of the banking sector to the 1990s team that failed to succeed abroad.
Subramanian said that while China has 18 banks, the US has 12 banks in the global top 100, there are countries “that are a fraction of our (economy) size (but) have far more banks in the global top 100.” For instance, Countries like Finland which is 1/11th and Denmark, which is 1/8th the size of the Indian economy, has one bank in the global top 100. “Indian banking sector cannot be satisfied by replicating the fortunes of the 90s cricket team to do well in India. A change in mindset from tigers at home has to change. We have to start evaluating ourselves in a global perspective.
The CEA also urged banks to invest in technology to “defeat the nefarious designs of the wilful defaulters.” To stress its significance, Subramanian referred to Deep Thought – chess-playing computer developed by IBM that defeated chess grandmaster Garry Kasparov in 1997. “If AI-driven software could actually defeat the tactics and strategies of Garry Kasparov, then defeating the nefarious designs of wilful defaulters is a child’s play for the software. The point is do our bankers recognize this opportunity and are willing to invest in that kind of data. The opportunity is very much there.”