IDBI Bank & Fairfax | Who Actually Benefits From India's Largest Financial-Sector FDI

A failed auction in March became a ₹52,878 crore sale in October. The cash goes to the state and to LIC. Whether ordinary Indians gain depends on what the new owner does with a bank that is holding far more capital than it lends.

What IDBI does establish is a workable process. Set the reserve price on fundamentals rather than a speculation-inflated share price. Write employee protections into the contract instead of offering open- ended state guarantees. Give the regulator a clear timetable for any ownership conflicts. If those lessons carry over, the next PSU bank sale will be less about whether the state is willing to sell and more about whether a bank of comparable quality is on offer. At present, few are.

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