The government’s proposed sale of a majority stake in IDBI Bank to Canadian financial group Fairfax Financial Holdings has come under scrutiny over the valuation and bidding process.
On 14 October 2026, the Cabinet Committee on Economic Affairs approved the sale of a 60.72 per cent stake in IDBI Bank for Rs 52,878 crore. The transaction involves a 30.48 per cent stake held by the government and 30.24 percent owned by the Life Insurance Corporation (LIC).
The controversy centres on Fairfax’s final offer of Rs 81 per share, compared with the initial reserve price of Rs 94.42. A media report citing internal government meeting minutes raised questions about changes in the valuation methodology after the initial bids failed to meet the reserve price.
The report also questioned the selection of public sector banks as valuation comparators and referred to the use of provisions from the Railway Stores Code in the decision-making process.
The Finance Ministry has rejected allegations of procedural irregularities, maintaining that the process was conducted within the powers delegated to the Core Group of Secretaries on Disinvestment. It said independent valuation exercises were carried out and that the final offer exceeded the revised valuation benchmark of Rs 75.99 per share.
Congress leader Rahul Gandhi has opposed the sale, raising concerns about employee protections, pensions and reservation policies following privatisation.
The government has defended the transaction, while questions over its valuation and transparency continue to attract political and public attention.
