Regional Economy of India – Book review by P. P. RAMACHANDRAN

One of the happy developments in the field of “ economic literature” is the collaboration between the Academic Foundation and the Reserve Bank of India resulting in a series of books that throw a flood of light on banking, economics and our economy. The book under review is the latest and is edited by Deepak Mohanty, Executive Director of RBI

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RBI mela to root out coin shortage

BHUBANESWAR: Shopkeepers asking customers to buy a toffee or a matchbox instead of asking for change is a common phenomenon these days. It seems as if coins of Re 1, Rs 2, and Rs 5 have suddenly disappeared from the market. To meet the coin shortage and help traders, the Reserve Bank of India, Bhubaneswar, on Saturday organized a coin mela at the Unit-I market. "We distributed coin worth Rs 10 lakh among the traders. Our aim is to bring more coins into the market and help both traders and consumers," said Venkateswar, Deputy General Manager of RBI. He, however, denied that there is a shortage of coins. "People are not recycling the coins resulting in this artificial shortage," he said........

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Inclusive growth is key for financial deepening: Pranab

.......“Financial inclusion is close to my heart …It is a necessary condition for financial deepening, which will help us address the basic issue of growth with equity,” ........

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When banks lose your cheque...

....... keep this as a thumb rule – if you have deposited a local cheque, RBI rules say that credit should be given on the same day or utmost, the next day. For outstation cheques, the maximum timeframe for collection of cheques drawn on State capitals/major cities/other locations is 7/10/14 days respectively. So, if the amount has not reached your account within the mandated days, you can immediately approach your bank to find out what is wrong.............

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Nabard to oppose any amendment to Co-operatives Act

... "If the West Bengal government goes ahead with amending the Act without informing Nabard, then we will oppose it," National Bank for Agriculture and Rural Development (Nabard), Chief General Manager of regional office, S Padmanabhan said.......

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Saving the debt markets

......Indian investors love fixed returns and the Indian government is a prodigious borrower. Why, then, is the Indian bond market in the doldrums? This is the question analysed threadbare in a recent speech by the RBI Deputy Governor, Mr Harun R Khan, at a recent conference of money and bond market participants .....

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Panel suggests easy fund availability for MSME sector

..... According to a recent RBI directive, collateral-free loans up to Rs 10 lakh should be extended by banks to MSE sector. Greater availability of credit can contribute to the faster modernisation and expansion of these enterprises and the augmentation of their productivity and competitiveness.
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Dr Subbarao, easy money isn’t the answer. Stand firm

….Dr Subbarao, as you set your monetary policy goals later this month, think of the retirees and middle class earners who lose the value of their income and savings from easy money. It may seem like a lonely fight when you deal with the political and governing class, but there is a silent majority that appreciates sound money and stable prices…..

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Fear of higher slippages from restructured assets overdone : RBI

..... "Anecdotal evidence points to the fact that maximum 15-20 percent slippages happen in case of restructured assets. That is not bad as 80 per cent of assets remain standard," Sinha said on the sidelines of 6th International Banking and Finance Conference......

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Dynamic provisioning: What can it do to banks?

The Reserve Bank of India has put out a discussion paper on dynamic provisioning norms stating that banks should start maintaining higher provisions in good times so as to adjust for bad times................

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Slow economic growth may hurt banks' asset quality, says Pranab

...... Quoting the financial stability report of the Reserve Bank of India (RBI), Mukherjee said though there had been some deterioration in financial soundness indicators yet capital adequacy remained well above the regulatory requirements and asset quality indicators continued to compare favourably with ratios in peer countries.......

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State Bank of India Sees Lower Deposit Growth

.... . Chaudhuri expects the banking system to report 14%-15% deposit growth in the last fiscal year. Separately, central bank Deputy Governor Anand Sinha said banking system deposit growth isn't as high as envisaged. These statements come at a time when the government is scheduled to borrow a gross 5.7 trillion rupees ($111.66 billion) and a net.....

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'Subsidy to discoms must be transparent'

.....“The State budgets follow cash accounting as opposed to accrual-based accounting,'' says a study by the RBI on State finances. As such, “information on unpaid subsidies, loans extended against State government guarantees/letters of comforts as also guarantees invoked, if any, should be transparently reported by the State governments,'' the apex bank feels........

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The dollar drain

....Very clearly the capital inflow surge was forcing the central bank to buy up the surplus foreign exchange in the country, to prevent excessive appreciation of the currency, since that was eroding the competitiveness of India’s exports. The result was that the RBI was burdened with excess foreign reserves, and was therefore finding it difficult to control money supply.....

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