Synopsis In the post-nationalization period, Indian political sector commercial banks have made rapid strides of progress by way of branch expansion, geographical coverage, priority sector lending and social banking.  Departing from the tradition of lending to the agricultural sector, rural development and the small-sale entrepreneur and the tiny sector.  Despite the positive emerging trends in the public sector banks by in servicing the priority sectors by adopting innovative schemes and developmental programmes like PRI, VAP / SAA (Differential Rate of Interest, Village Adopted Programme / Service Area Approach / DIR, etc.) a disturbing trend in terms of mounting overdues, plummeting profits, weakening operal efficiency  has been noticed.  Narasimham Committee has sounded a note of warning to the public sector banks to arrest the rising trend in over-dues, phase out the priority sector lending.