SBI, LIC Among State-Run Firms Asked to Reduce Spending, Adopt EVs

The Finance Ministry has directed public sector banks, insurance companies and financial institutions to follow austerity measures, including reducing travel expenses and increasing the use of electric vehicles (EVs), as per a Reuters report.  

The circular applies to public sector banks, regional rural banks, public sector insurance companies and other state-run financial institutions.  

Institutions such as State Bank of India (SBI), Bank of Baroda (BoB) and Life Insurance Corporation of India (LIC) are among those covered under the measures. The instructions were issued by the Department of Financial Services (DFS) and have come into effect immediately. 

Video Conferencing to Be Preferred 

The ministry has asked organisations to conduct meetings, reviews, and consultations through video conferencing unless physical presence is required. The circular also called for tighter control over official travel expenditure. 

Foreign travel by chairpersons, managing directors, chief executive officers and whole-time directors should remain within prescribed limits, according to the order. It added that overseas meetings and engagements should be attended virtually wherever possible. 

EV Transition Planned in Phases 

The government has also instructed institutions to gradually replace petrol and diesel vehicles hired for official use with electric vehicles. The circular said offices should shift to EVs “as far as possible”. 

It added that the existing vehicle fleet should be moved to electric vehicles in a phased manner. The direction applies to both head offices and branch offices operated by these institutions. 

The push towards EV adoption comes alongside the government’s plans to reduce fuel consumption and lower operational costs in public sector entities. 

Measures Linked to Wider Cost-Control Push 

The instructions follow the Prime Minister’s recent appeal for restraint in spending amid concerns linked to the ongoing West Asia conflict. 

He had called for lower fuel consumption, limited foreign travel, delayed gold purchases, and use of public transport, work-from-home arrangements and electric vehicles to help conserve foreign exchange. 

Read More: Haryana Cabinet Bans Petrol and Diesel Cabs in NCR Under New Rules! 

Conclusion 

The latest directives indicate an effort by the Centre to reduce discretionary spending across state-run financial institutions while encouraging digital operations and electric mobility. 

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