The IBA meeting is a significant one as the entire banking industry is working towards averting a strike that is likely to prove a major embarrassment to the Government, coming as it will during the budget session of the Parliament.

"We are putting forth the proposal of the unions for an 18 per cent hike before the management committee. They will discuss the issue and decide on whether to accept the unions' demand for an 18 per cent hike or not," IBA chief executive and secretary MN Dandekar told The Financial Express, adding: "The management committee, which was supposed to meet on March 10, will now meet on February 24 to consider the new offer."

Themeeting of IBA's management committee -- its top decision-making body -- on February 24 will follow parleys with the IBA to be held a day earlier.

Banks are going on a two-day strike to protest against the initial 8 per cent wage hike offered by the IBA. Thereafter, from March 17, about 12 lakh bank employees will go on an indefinite strike to protest against the wage settlement. The strike call, apart from causing much damage to the economy, is expected to hold up bank results for the year ending March 30, 1999.

"We have given them various offers including an offer where a better hike will be given to stronger banks and lower hike to the weaker ones. But this is not acceptable to the unions and, therefore, there is a deadlock," said Dandekar. The new offer was made in the presence of the regional labour commissioner and the joint labour commissioner.

Finance minister Yashwant Sinha had earlier told the IBA to reconsider a hike in wages in a bid to avoid the strike after a meeting with the bank unions.Dandekar, however, denied that there is any pressure on the banks to succumb to the unions' demand. "There is no pressure on us. We are not likely to revise our present offer for a 10 per cent hike with prospective effect. But let the management committee take a decision on that," he said. IBA's top brass held a meeting with the minister of state for finance, revenue, banking and insurance, MP Janardhanan, in New Delhi last week in a bid to sort out the stalemate on the wage front. The following day the unions rejected the 10 per cent wage hike offer by the IBA and watered down their wage hike from 20 per cent to 18 per cent. "This is also not acceptable to the IBA," Dandekar added.

Bankers say that every 1 per cent hike will cost the industry Rs 100 crore and a 10 per cent hike would lead to an outgo of Rs 1,000 crore. Bank unions have blamed the non-performing assets (NPAs) of banks that have accumulated to several crores of rupees to wrong lending policies of the banks. The IBA, on its part, has evenindicated that it is ready to go on the offensive if the bank unions reject the revised offer and stick to their stance of a strike. "The Air Traffic Controllers' strike has been broken. Even we will do something," an IBA source said.