Banking in India: Evolution, Performance, Growth and Future

DOI10.1177/0019556120953711
Date01 September 2020
AuthorShilpa Arora,Nand L Dhameja
Published date01 September 2020
Subject MatterArticles
Banking in India:
Evolution,
Performance, Growth
and Future
Nand L Dhameja1 and Shilpa Arora1
Abstract
Banks, a significant part of financial system of a country, are essential for its eco-
nomic development. They have developed over the years and are faced with the
challenges for the bright future. The article discusses development and future of
banking sector in India in the light of the reforms over the years and is divided
into four parts. The paper traces evolution and significance of banking, discusses
reforms during pre-liberalisation and post-liberalisation as recommended by
various Committees, namely, Narasimham Committees (1991 & 1998), Verma
Committee (1996) and Khan Committee (1997) along with the structural and
operational reforms. The performance challenges in terms of fee-based income,
profitability, credit deposit ratio, business and profitability per employee are
highlighted, comparing the public sector banks and private banks.
Keywords
Banks nationalisation, Basel norms, Capital Adequacy Norm, Capital to Risk
Assets Ratio, Non-Performing Assets
Evolution of Indian Banking: An Overview
In India, banking has been in existence as a part of economic system, even during
ancient times, although in a crude and elementary form. In the Vedic times, 2000
to 1400 bc, banking practice of money lending existed, as there is repeated
mention of rina or debt in the Vedic literature, and banking became a full-time
business activity for people during the Ramayana and Mahabharata eras. The
Article
Indian Journal of Public
Administration
66(3) 312–326, 2020
© 2020 IIPA
Reprints and permissions:
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DOI: 10.1177/0019556120953711
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1 Faculty of Management Studies, Manav Rachna International Institute of Research and Studies,
Faridabad, Haryana, India.
Corresponding author:
Nand L Dhameja, Dean and Professor, Faculty of Management Studies, Manav Rachna International
Institute of Research and Studies, Faridabad, Haryana 121004, India.
E-mail: nanddhameja@yahoo.co.in

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