Editorial

The Reserve Bank of India’s recent approval allowing global private equity giant Blackstone to acquire up to a 9.99 % stake in Federal Bank marks a watershed moment in the ongoing transformation of India’s financial services landscape. The decision — which came after regulatory clearance from the Competition Commission of India — permits Blackstone’s affiliate Asia II Topco XIII to invest approximately ₹6,196.5 crore in the Kochi-based lender through a preferential issuance of warrants convertible into equity shares. On full conversion, Blackstone will become the single largest shareholder in a bank that has no traditional promoter base, signalling a shift in how capital is sourced and controlled in domestic banking.

This move is not just another capital infusion; it underscores India’s emergence as a formidable destination for global financial capital. Over the past year, the Indian banking sector has witnessed a flurry of foreign investments — from Emirates NBD’s acquisition of a majority stake in RBL Bank to SMBC’s expansion in Yes Bank — collectively amounting to billions of dollars and reshaping ownership patterns in private banking. The RBI’s approval thus must be seen in context: as part of a broader trend of strategic foreign participation, enabled by domestic regulatory comfort, rising growth prospects, and increasingly robust banking fundamentals.

For Federal Bank, Blackstone’s entry brings more than capital. It offers a sort of global validation of the bank’s strategic potential. The infusion will bolster its capital adequacy, enabling deeper penetration into retail and MSME lending, digital banking innovations, and a stronger competitive stance against larger peers. The right to nominate a board director — contingent on retaining a minimum stake — further signals an evolving governance profile, where institutional expertise and global best practices may catalyse performance and risk management.

Yet, this enthusiasm must be balanced with caution. Foreign ownership — particularly by private equity firms — can introduce new dynamics in decision-making, strategic priorities, and risk appetites. As commentators have noted, the Indian banking sector’s stability hinges on grounded, context-specific governance attuned to local economic cycles.

Ultimately, the RBI’s nod reflects a pragmatic shift: embracing foreign capital not as a threat, but as a strategic lever for growth. If managed with prudence, this episode could herald a new era where Indian banks harness global capital and expertise to drive financial inclusion, innovation, and enduring resilience.

The launch of Bharat Taxi by Union Home and Cooperation Minister Amit Shah represents a bold new experiment in India’s urban mobility sector — one that seeks to recalibrate the balance of power between ride-hailing platforms and the drivers who power them. Officially unveiled on 5 February 2026, this platform is India’s first cooperative-led ride-hailing service and is being pitched as a people-centric alternative to private aggregators such as Ola, Uber and Rapido.

At its core, Bharat Taxi is built on a cooperative ownership model, where the drivers — known as sarathis — are not merely gig workers but stakeholders and co-owners of the business. Each driver holds shares in the cooperative society that operates the platform, entitling them to dividends and a share of profits. The cooperative is registered under the Multi-State Cooperative Societies Act and was established in June 2025, followed by a pilot phase in parts of Delhi-NCR and Gujarat.

One of the most striking differentiators of Bharat Taxi is its zero-commission and surge-free pricing model. Unlike conventional ride-hailing platforms that extract significant commissions — often between 20 % and 30 % per trip — Bharat Taxi ensures that 100 % of the fare goes directly to the driver. This shift fundamentally alters the economics of app-based transport, prioritising driver earnings and transparency over platform profitability.

Beyond immediate financial gains, the initiative also seeks to enhance driver welfare and income security. Cooperative members benefit from personal accident and family health insurance, retirement savings options and dedicated support systems. Bharat Taxi’s model allows drivers to work across multiple platforms without exclusivity clauses, helping them maximise their earnings and autonomy.

For consumers, the promise is competitive and transparent fare structures — with government sources claiming fares could be up to 30 % lower than rival services because of the absence of surge pricing and hidden costs. The platform also integrates auto-rickshaws and bike taxis into its system, expanding choice for urban commuters.

However, challenges remain. India’s ride-hailing market is intensely competitive, shaped by deep discounting and heavy investments by global technology firms. For Bharat Taxi to scale beyond its pilot regions and achieve long-term sustainability, it must not only attract users but also maintain service reliability and robust operational infrastructure. Nevertheless, as an experiment in democratic ownership and gig-worker empowerment, Bharat Taxi signals a potentially transformative shift in how digital platforms can be structured — blending cooperative principles with modern technology to deliver both equity and efficiency.

• SAS Kirmani