The privatisation of two public sector banks seems to be moving forward. Niti Aayog, the government think tank, submitted on Thursday the finalised names of the state-owned banks to be privatised in the current financial year to the Core Group of Secretaries on Disinvestment.

The government has tasked Niti Aayog with the selection of names of public sector banks and one general insurance company for privatization.

Following the clearance from the Core Group of Secretaries, headed by the cabinet secretary, the finalised names will go to Alternative Mechanism (AM) for its approval and eventually to the cabinet headed by the Prime Minister for the final nod.

Changes on the regulatory side to facilitate privatisation would start after the Cabinet approval.

The members of the Core Group of Secretaries include economic affairs secretary, revenue secretary, expenditure secretary, corporate affairs secretary, legal affairs secretary, Department of Public Enterprises secretary, Department of Investment and Public Asset Management (DIPAM) secretary and an administrative department secretary.

Recently, Finance Minister Nirmala Sitharaman said, "Interests of workers of banks which are likely to be privatised will absolutely be protected whether their salaries or scale or pension all will be taken care of".

Explaining the rationale behind the privatisation, Sitharaman had said that banks in the country needed to be bigger, just like the State Bank of India (SBI).

"We need banks which are going to be able to scale up... We want banks that are going to be able to meet the aspirational needs of this country," Sitharaman had said, adding that a lot of thought had gone behind the intention to privatise some public sector banks.

The government has budgeted Rs 1.75 lakh crore from stake sale in public sector companies and financial institutions, including two PSU banks and one insurance company, during the current financial year. The amount is lower than the record budgeted Rs 2.10 lakh crore to be raised from CPSE disinvestment in the last fiscal.