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| RBI guv must put the economy back on track before he goes in a year ......Subbarao can act at the cost of upsetting his bosses. But then, his real bosses are not in North Block. They are the 1.2 billion citizens who still believe that RBI is the watchdog against inflation and a doctor to rejuvenate the economy. Subbarao still has a year to go. He can meet those aspirations or leave with the economy in a deeper mess. |
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Saturday, August 11, 2012
Subba row
RBI confirms ‘policy stasis’ is very grim
Months after former chief economic adviser Kaushik Basu had to eat his words for using the phrase ‘policy paralysis’, comes the same from a more important source. And this time, there’s no question of eating, no matter the change in phraseology. In a background paper prepared for parliamentarians, the Reserve Bank of India (RBI) has painted a grim picture of the current economic situation and policy options. It states for a revival in investor confidence, there is a need to address concerns “over policy stasis” while putting in place “complementary actions that address macro-economic weaknesses.” The RBI’s choice of the word ‘stasis’ instead of ‘paralysis’ is indeed inspired erudition. The dictionary meaning of the noun is “inactivity caused by opposing equal forces”..........
Govt should not undermine RBI - M.Y.Khan
......The cap on Government borrowing, enforced by the RBI, has been violated by the Government from time to time. This limit was fixed as a mandatory cap. Today, inflation in India has become a function of Government deficit. Under the RBI Act, 1948, “the Central Government may from time to time give such direction to the bank as it may, after consultation with the Governor of the Reserve Bank, consider necessary in the public ‘interest’ ” but it is not mandatory for RBI to provide credit to Government. In the past, Government did intervene or disrupt the functioning of RBI policy, without regard to the RBI.........
RBI will stick to borrowing calendar, says Khan
Reserve Bank of India (RBI) will stick to the present market-borrowing calendar (April-September) for now, as there was still time for review, said Deputy Governor H R Khan..............
Leadership deficit main reason for slump in manufacturing: RBI Deputy Governor HR Khan
Government decides to put on hold the Banking Laws (Amendment) Bill
The wait for new bank licences just got longer as the government has decided to put on hold the Banking Laws (Amendment) Bill. Senior officials in the government said the Bill would not be taken up until differences are resolved between the Reserve Bank of India and the Competition Commission of India over whether the latter should have the remit to review mergers and acquisitions in the sector..............
Issue Multi-City Cheques Without Charges: RBI to Banks
With a view to improving customer services and speeding up fund transfer, the Reserve Bank today asked all CBS (core banking solutions)-enabled banks to issue multi-city cheques to all eligible customers and refrain from levying clearing charges on them. "... All CBS enabled banks are hereby advised to issue only 'payable at par'/'multi-city' CTS 2010 Standard cheques to all eligible customers," RBI said in a notification. A 'payable at par' or 'multi-city' cheque of a bank can be cleared by any branch of the same bank in the country. The process has significantly reduced the outstation cheque clearance time........
Additions to the basic accounts under financial inclusion plan
RBI had advised banks in November 2005 to make available a basic no frills account with nil or very low balance so as to cover a vast population which does not have access to banking services at present. It has been now decided to modify the guidelines for opening such accounts. The basic account will now include services like ATM, credit of money through electronic payment channels or by means of deposit as well as collection of cheques drawn by government departments, says a notification recently posted on the RBI website. The account holders will get ATM-cum-debit cards too and the facilities will have to be provided without any charges.............
Kisan Credit Cards for ATMs?
Ranchi: Aiming at increasing its spread and popularity amongst farmers, the RBI has instructed the banks to simplify Kisan Credit Cards (KCCs). The cards would be modified into electronic KCCs with debit card facilities.............
Read - The Pioneer
Anywhere ATMs
....A conventional ATM consumes 500 to 600 watts of power. They consume so much power because they use conveyor belts to move the currency notes. Also they may stop functioning at temperatures above 35 degrees. The rugged Vortex ATMs, in contrast, use a different, patented technology to move the notes without conveyor belts. In conventional ATMs, cash is transported upwards from almost floor-level, which requires a lot of power. Vortex ATMs, on the other hand, have a gravity-assisted track in which the currency notes fall into the dispensing slot. So they consume very little power (less than 100W) and can function in temperatures of up to 50 degrees.......
Nodal police stations to deal with fake notes in districts
.....Attributing the need of having dedicated police stations for investigating fake currency notes cases to the alarming rise in the smuggling of fake currency and excessive circulation in nationalized and private sector banks, senior police officers on Monday confirmed that four such police stations are identified in Jaipur........
Cash for Casa: Banks reward staff to boost low-cost deposits
To stabilise fund flows by increasing the share of low-cost deposits, banks are giving cash incentives and recognition certificates to employees for opening the highest number of current accounts or savings accounts (Casa). The incentive is Rs 50-100 per account but there is an overall cap on how much an employee can earn through such schemes. The move also aims to cut dependency on bulk deposits.........
The RBI's free pass
......The Reserve Bank of India’s (RBI’s) air of technocratic and academic competence means that we may discreetly disagree with its actions, but we cannot really call it to account. The free pass that we’re giving the RBI is a mistake. The “independence” of the central bank is a cherished property, but it means independence from executive interference. It does not mean a lack of accountability. In the absence of accountability, the same errors will build up at the RBI as anywhere else: errors born of a closed mind, and a sense that you know best. Such errors are dangerous anywhere, but they are particularly unacceptable in an agency that makes macroeconomic policy — because, in spite of what you’ve been told, macroeconomics is a very incomplete subject. Compared to other branches of the discipline – econometrics, say, or microeconomics – macroeconomics too often consists of a certain amount of voodoo mumbling followed by the bellowing of a pre-prepared conclusion........
RBI cancels NBFI registration certificate of Maruti Sec
The Reserve Bank today said it has cancelled Maruti Securities' registration certificate for carrying on business of a non-banking financial institution (NBFI)..........
More pain ahead
Data released by the Reserve Bank of India (RBI) on Friday shows that mean inflationary expectations during April-June inched up from the previous one by 30 basis points for the three-month and one-year periods ahead to 12% and 12.8%, respectively.......
Households expect inflation to rise, finds Reserve Bank survey
Indian households expect inflation to rise by 30 basis points in the near term, primarily due to high food prices, according to a Reserve Bank of India (RBI) survey for the April-June quarter........
Raghuram Rajan appointed chief economic advisor
Former International Monetary Fund chief economist Raghuram Rajan has been appointed the chief economic advisor in the Ministry of Finance. The Appointments Committee of the Cabinet approved his name on Friday, a finance ministry official said. Rajan succeeds Kaushik Basu, who would return to a professorship at Cornell University in the US...............
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