Cut back on foreign travel, use more electric cars: Treasury ‘savings’ moves for public sector banks and insurers

According to a circular reviewed by The Hindu, the Ministry of Financial Services has asked the heads of its regulated entities to cut costs in two main directions: curbing travel and adoption of electric vehicles (EVs). File | Photo credit: The Hindu

The finance ministry on Monday (May 18, 2026) wrote to heads of all public sector banks, regional rural banks, public sector insurance companies and small public sector financial institutions, urging them to adopt several “austerity” measures in a bid to rationalize spending.

According to the circular, reviewed by The Hindu and titled “Implementing austerity measures to rationalize expenditure”, the financial services ministry has asked the heads of its regulated entities to cut costs in two main directions: curbing travel and adoption of electric vehicles (EVs).

The circular does not mention the crisis in West Asia, but comes a little more than a week after Prime Minister Narendra Modi called on the nation to adopt similar austerity measures.

The circular specified that “all negotiations, reviews, consultations and presentations” are to be conducted via video conference unless physical meetings are specifically required.

It added that foreign travel by chairmen, CEOs and managing directors, whole-time directors and board members of these institutions “may be kept under the prescribed limits” as set out in the existing guidelines. She added that if possible, such meetings should be held via video conferencing.

“All organizations can aim to replace the petrol and diesel cars they hire in their headquarters and branches with electric cars if possible,” the circular added. “Existing fleets will be gradually converted to EVs in stages.”

The government has also adopted such austerity measures in the past. However, those adopted on Monday are likely to be the most drastic since the steps taken in 2020 in response to the COVID-19 pandemic.

Published – 18 May 2026 22:18 IST