According to former finance secretary Subhash Chandra Garg the dispute is not mainly over whether IDBI Bank should be privatised. It is over whether the sale process gave bidders a fair chance—and whether the bank was sold at a fair price.
The government has approved selling 60.72% of IDBI Bank to Fairfax Financial’s subsidiary for ₹52,878 crore, or ₹81 per share. The sale is not yet complete; RBI approval is still required.
As former finance secretary Subhash Chandra Garg argued that several bidders dropped out or did not submit bids. The initial bids reportedly came in below a ₹94.42-per-share reserve price. Critics say that, instead of ending the process, the government revised the valuation process and proceeded with what became close to a one-bidder contest—raising concerns that the benchmark was effectively lowered to make a sale to Fairfax possible.
A reported internal note has added to the scrutiny: it says officials saw Fairfax’s revised bid before fresh valuation work was ordered. Critics argue that this raises questions about the sequence and transparency of the process.
The government says the first round ended after bids failed to meet the reserve price, and that the reserve price itself was not changed. It says the revised process followed valuation review and produced a higher bid, adding ₹3,917 crore to the value discovered in the second round.
The central question is whether the process was genuinely competitive and the ₹81 price defensible—not simply whether privatisation is desirable. The public disagreement is unresolved: critics point to bidder withdrawals, the revised valuation process and limited transparency; the government says the process was reviewed and the eventual offer improved. The valuation reports have not been made public.
The earlier LIC acquisition is part of the backdrop: LIC took a 51% stake in IDBI in 2019, with the bank subsequently treated as a private-sector bank for regulatory purposes.
Rahul Gandhi has opposed the sale of IDBI Bank to Fairfax and backed employees campaigning against privatisation. His main arguments are:
Public banks serve a broader public purpose: he described them as “tools to build the nation,” rather than assets to be sold.
Why sell a profitable bank? He questioned the rationale for selling IDBI and how employees’ and depositors’ interests would be protected.
Potential impact on workers: he warned that privatisation could affect employees’ service conditions and protections, including reservation safeguards for SC, ST and OBC communities.
Political framing: he contrasted the Congress’s record of creating public banks with what he characterised as the Modi government selling them.
This is a political argument against the principle and consequences of privatisation. It is separate from the process-focused criticism discussed earlier—whether the bidding and valuation gave Fairfax an unfair advantage.
Conflict of interest:
LIC Director sat on Fairfax Co's Board While LIC Was Selling IDBI to Fairfax.
For seven mnths, G.Mahalingam sat on boards of both LIC, a seller of IDBI Bank, & the Fairfax-controlled Thomas Cook, as Fairfax bid for the bank.






