2014 A Tough Year for the Indian Economy

A tough year ahead for the economy:

First decade of the century had witnessed greater height and steeper fall in global economy the same has been true for Indian economy. The greatness of Indian economy, though at pains, is that it kept on expanding twice the global economic expansion rate during this period. Some even say that the economy is moving more by sentiments than fundamentals, because we do not have the rate of savings and investments moving up as was the case five years ago.

VITALINFO: Why FinMin wants public sector lenders to rush into selling insurance

VITALINFO: Why FinMin wants public sector lenders to rush into selling insurancePSBs to sell the insurance products and invest in training of its staff already overloaded with other regular banking work and not having time to spare for training off their operating desks, would end up selling soaps of TATA by Proctor and Gamble. The bancassurance itself has not take off as a corporate agency model successfully. Most staff today know only the system and not banking domain. If they are asked to get into another domain insurance as well, the banks' balance sheets will take a big hit. It is time that the banks are allowed to do banking more efficiently and in a more customer-friendly manner and also devote more time for innovation of new deposit and credit products competitively in the emerging rural areas. It is also important that the human capital should be allowed to add its weight for strengthening Basel III emerging capital requirements. 'Let not thy winged days be spent in vain, where gone no gold can try them back again.'(Oliver Goldsmith) It is time to revisit the recommendation of the First Financial Sector Reforms of M. Narasimham on the Government diluting its hold over public sector banks, particularly in not getting into micro management. Let the banks decide for themselves what business they should do and what they should not and hold themselves responsible for all their decisions.

RBI and increasing NPAs of banks - Moneylife

RBI and increasing NPAs of banks - Moneylife

VITALINFO: Soon banks will be graded - good, bad or ugly by a new regulator to foster service culture

VITALINFO: Soon banks will be graded - good, bad or ugly by a new regulator to foster service culture

Sthitapragna

STHITAPRAGJNA 
Thiru Dr. M. S. SWAMINATHAN


Imagining this great scholar 

Is no more with us, And

This architect of Green revolution

Found his place in Heaven,

Left me in grief unmeasured.

Glory and glitter,
Simplicity and grandeur
Thine inner chambers
Even in charming greens.

Knowledge you inhale
Research you exhale
Thou art breathing farming fresh
Benevolent thou, beckon
Nation’s Farm Policy.

Bright in looks
And long in titles
Only short of ‘Nobel’,
Sweet and warm
Your gesture unforgettable.

Penning ‘Foreword’ for
Agricultural Banking:
Getting the perspective Right
Thou art conferred a great honour unto me.

‘Files drive Right to Information
Farmers drive Right to Food’
Who else but thou can short-script thus.
Recalling my humble offering,

Tears rolled down

Hearing your sad demise

May your soul rest in peace

With Gods holding a bouquet

To welcome you.

B. Yerram Raju
28-10-2023

Financial Inclusion - Full of Sound and Fury

Financial Inclusion is full of sound and fury:

As India faces General Elections in the next four months it is time to look at the Financial Inclusion efforts as it is a barometer for poverty reduction. The CRISIL Financial Inclusion index showed a marginal improvement of around 2.2 between 2010 and 2011. The RBI's composite analysis recently put down by its Executive Director, P. Vijay Bhaskar says that from the NSSO 59th round (Jan-Dec 2003) reflecting a financial exclusion of 51.4 percent farmer households there is considerable improvement but fails in its own study to make exact comparison where it mentions in of all the rural households having access to financial services from the banks. This chart depicts from 1951 to 2002 the course of debt from the formal and informal sources. The formal sources increased by just 4.2% between 1991 and 2002 - the initial years of reforms in the banking sector while the informal sources of debt increased by 13.8% during the same year.

VITALINFO: RBI's Joshi on the bank's wide-ranging strategies to raise financial awareness

VITALINFO: RBI's Joshi on the bank's wide-ranging strategies to raise financial awareness
While RBI's Joshi rightly highlighted the current efforts of the Central Bank on financial awareness, the snail space at which such efforts are moving only expose the lack of interest on the part of the actual players: even the FLCs are not functioning the way they should. In fact their creation happened with lot of drive and push from the RBI. If such efforts do not internalize in the organizations for effective delivery, they remain cosmetic. The opportunity cost of monitoring from the central bank would be quite high. It is desirable that an external monitoring group be set up by the RBI where region-wise, a representative of reputed academic or training institution, a representative from NGOs, a representative from the RBI regional office as members who can oversee the outputs of the FLCs at the ground level.

Ten measures to mitigate valuation risks in real estate

Valuation Risks Need Recognition and Mitigation

Not a day passes without the realty sector hitting the headlines; and not always for right reasons. A realtor kills his mother in a car and also makes believe that he was dead and gone only to surface after two years – a case reported by the media extensively during the third week of November 2013 in Andhra Pradesh. Campa Cola Compound had to face demolition after the property owners were served notice of demolition for violation of FSI five years back just during the second week of November 2013. Hiranandini Construction Company received a Court verdict of Rs.76crores leading to liquidation while its prime properties in Chennai and Panvel are close to completion. Raheja Constructions received a huge penalty and punishment handed down by the Supreme Court in October 2013 for not handing over the promised flats to the investors. The Adarsh Housing Society of Mumbai is still under CBI investigation. Many more violations are awaiting court verdicts in different parts of the country. There is governance risk, reputation risk and market risk. One may ask: where is the valuation risk in all these deals? It is hiding deep in the skin of the sector. The reader may recall that the raison de ‘etre of recession was the subprime lending led by credit rating exuberance and inflated valuations. The resultant global recession is still staring at us.