Finance Minister Nirmala Sitharaman said the government will soon constitute a high-powered committee to review India’s banking sector and recommend reforms aligned with the Viksit Bharat 2047 vision.

The Centre is preparing to constitute a high-powered committee on banking reforms, Finance Minister Nirmala Sitharaman said on Monday while addressing the Public Sector Banks (PSB) Confluence 2026 in New Delhi. The proposed panel will examine the future role of the banking sector and provide recommendations to support India’s next phase of economic growth.

Committee to Guide Banking Reforms

Sitharaman said the announcement of the high-powered committee is expected soon. The recommendations and conclusions emerging from the two-day PSB Confluence will serve as substantive inputs for the proposed panel.

The committee was originally proposed in the Union Budget 2026-27 as the High Level Committee on Banking for Viksit Bharat. Its mandate is to comprehensively review the sector and align it with India’s evolving economic requirements while protecting financial stability, inclusion and consumer interests.

PSB Confluence Sets Reform Agenda

The announcement came on the first day of the two-day PSB Confluence, organised by the Department of Financial Services under the Ministry of Finance. Senior executives of public sector banks, public financial institutions, government officials and sector experts are participating in the discussions.

The conclave is focusing on practical strategies that banks and financial institutions can adopt as India works towards its long-term development objectives.

Seven Key Areas Under Discussion

According to the Ministry of Finance, the discussions cover seven broad themes relevant to the future of public sector banking. These include deposit mobilisation, banking for youth, support for the investment cycle, global capability centres, agriculture and horticulture value-chain infrastructure, priority sector lending and reimagining the credit card business.

Sitharaman has particularly highlighted the importance of understanding India’s young population while designing future banking products and services. The government estimates that nearly 29 per cent of the country’s population is in the 15-29 age group.

Banks Begin From Stronger Position

The Finance Minister also pointed to the improved financial health of Indian banks. She said non-performing assets (NPAs) are at their lowest-ever levels, providing a stronger foundation for the next phase of reforms.

The Union Budget had similarly noted improvements in bank balance sheets, profitability and asset quality, along with extensive banking coverage across the country.

Budget 2026-27 Set the Direction

The proposed committee was formally announced in the Union Budget presented on February 1, 2026. Sitharaman had said the panel would comprehensively review the financial sector and align it with India’s next phase of growth while safeguarding stability, inclusion and consumer protection.

The Budget also proposed measures affecting public sector financial institutions, including restructuring the Power Finance Corporation and Rural Electrification Corporation to improve scale and efficiency.

Focus on Viksit Bharat 2047

The proposed reforms are being framed against India’s longer-term goal of becoming a developed economy by 2047. Sitharaman said the country has less than two decades to work towards that objective, making it important to prepare the banking system for future economic requirements.

The government expects the banking sector to play a central role in financing investment, supporting businesses, expanding financial access and meeting the changing needs of households and young consumers.

What the Committee Could Examine

The final scope and composition of the high-powered committee are yet to be announced. However, the government has indicated that recommendations emerging from the PSB Confluence will be placed before the panel.

The committee is expected to provide a broader framework for the next phase of banking reforms. Its recommendations could influence how banks respond to changing credit demand, technology, financial inclusion and India’s long-term growth ambitions.