The government on Monday said that its mantra for banking reforms would be 'consolidation, competition and convergence' to enable PSU banks to become more stronger, bigger and globally competitive.

"Consolidation, competition and convergence are the three mantras being followed by banks the world over. India cannot be immune to that including Indian public sector banks," Finance Minister P Chidambaram said responding to a calling attention motion of CPI member Gurudas Dasgupta on the issue in the Lok Sabha.

The finance minister said at a time when India was aspiring to be an economic powerhouse, it should have at least five-six banks which could be counted among 100 largest banks in the world.

At present, only State Bank of India has a place among 100 such banks and is 82nd in that ranking. He disagreed with the member that the move would be counter-productive as consolidation would lead to banks becoming less competitive.

Dasgupta had called the attention of the minister regarding the 'situation arising out of the move of the government to change the banking policy, dilute the government stake in public sector banks, merge the public sector banks to form giant banks and enhance FDI limit in private to the detriment of interests of the common people.'

The minister had said earlier in a written statement that 'all the changes in the banking policy are being contemplated to strengthen the banking sector in India for the benefit of customers and preserve their trust in the banking industry.'