Under SEBI rules described in the report, an acquisition exceeding 25% requires the buyer to make an offer to public shareholders. If Canada-based Fairfax acquires the proposed stake, it may need to offer to purchase an additional 26% from them.

Sarma has sent multiple letters to Finance Minister Nirmala Sitharaman seeking a halt to the transaction. He argues that the proposed valuation is too low and does not adequately reflect IDBI Bank’s valuable properties in major urban locations. He has also criticised the exclusion of Indian public sector companies from bidding.

The objections also cover regulatory hurdles. The report cites an RBI restriction limiting foreign ownership in a new private bank to 49% during its initial five years. Fairfax’s existing ownership of CSB Bank raises another question, since RBI generally restricts a single promoter from controlling two banks. How these issues would be resolved has not been stated.

Employee protections are another concern raised by Sarma. The report puts the number of SC, ST and OBC employees at about 9,500, alongside women and staff with disabilities. Sarma argues that privatisation threatens reservation and welfare protections, and could conflict with service-condition safeguards under a 2003 law. He favours strengthening IDBI rather than selling it for budgetary reasons.