Government Fires Top Bank Executives, Orders Probe Into Car Sales
Feb. 19, 1985
NEW DELHI, India (AP) _ The government of Prime Minister Rajiv Gandhi has fired top executives of three nationalized banks and ordered an investigation into reports of black market car sales.
The three executives were dismissed Monday on orders from the Finance Ministry and were paid three months' salary in lieu of notice, news reports said Tuesday.
No reason was given, but the government has started to reconstitute the boards of directors of public sector banks to improve efficiency and increase profits, which are sometimes lower than those of foreign banks in India.
The three executives were identified as S.L. Baluja, chairman and managing director of the Punjab National Bank; B.V. Sonalkar, chairman and managing director of the Central Bank of India; and S.S. Master, executive director of the Bank of Baroda.
The government also ordered an investigation into reports of large-scale black market sales of new Maruti cars and vans. Marutis are coveted status symbols and are produced by a government-supported company in collaboration with the Japanese company of Suzuki.
The Indian Express reported Tuesday that the probe was launched by Finance Minister V.P. Singh on orders from Gandhi, who had received many complaints about the car sales.
The independent newspaper quoted automobile trade circles as saying some cars sold for as much as 100,000 rupees ($7,800) on the black market when they rolled off the assembly line last year.
The official price is about $5,000. But production has not met demand.
The newspaper, quoting investigating agencies, said car dealers sold the cars to buyers at a high premium.
The prime minister's office also received many complaints that the managers of the Indian company, Maruti Udyog, had allocated cars out of turn to their favorite customers, despite a plan to distribute the cars according to random computer selection, the newspaper said.