...........Governors M Narasimham, I G Patel and Manmohan Singh, all had great respect for his views. Dr Patel and Dr Manmohan Singh would, on occasions, refrain from taking certain measures in deference to the views of Dr Mujumdar, whom they called the ‘ High Priest of Policy.’ The 1981- 82 liquidity bind Commentators today freely talk of a liquidity crunch, the moment there is the slightest measure of monetary tightening. The 1981- 82 liquidity bind was unprecedented. Policy interest rates were raised sharply and stringent liquidity stipulations were prescribed. The money market was tight, rediscounting of bills by the RBI was discontinued and discretionary refinance was severely curtailed. In internal discussions, Dr Mujumdar argued that the monetary tightening could be milder. But once the policy was decided.......
The very purpose of VITALINFO is to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI.
Monday, April 21, 2014
Bandhan to start hiring in three months
....Ghosh, however, said it had not yet been finalised how many people would be needed at the senior management level. “It will depend on how many of our existing employees can be upgraded to the senior level for banking operations,” he pointed out. With employee strength of about 13,000, Bandhan is at present gearing up for capacity building down the line through intensive training. It already has eight training centres across the country.......
The NIF option - Dr.Subir Gokarn
.........From the perspective of the NIF, though, the strategic dimension provides a foundation for the other two aspects. Strategy could be internalised into the structure, thus making it into a National Infrastructure Commission, for instance. Or it could be an external mandate to a more narrowly focused mechanism, combining finance and governance.....
Call for 5-day week for state banks resurfaces
......... "A five-day week is already available in the international banking system. It is also available here - the Reserve Bank of India (RBI), central and state governments, and companies in the public sector work for (only) five days a week. We have been saying it should be introduced in the banking industry. The government had rejected the proposal but we have been pursuing it through UFBU,"...........
Mor panel's financial inclusion report may be put on back burner
.......The committee's suggestion that existing commercial banks be allowed to hold payment banks as subsidiaries is also seen as unviable by RBI and the finance ministry. The ministry believes this might not serve the purpose of financial inclusion, as NBFCs charge very high interest rates and might continue to do so even after being converted into banks. Besides, the ministry also feels.........
Understanding PM Manmohan Singh, a wary leader
......In the run up to this, Singh had faced severe resistance from the finance ministry headed by Pranab Mukherjee to suggestions that Subbarao be given a fresh term. Although rebuffed in the early rounds, Singh held on only to finally approve unilaterally a second term for the governor of India's central bank. A rare case in India's history when the appointment was announced from the PMO and not the finance ministry as it happened later when Raghuram Rajan was chosen to head the RBI............
Read - ET page 18
Read -ET page 19
Read - ET
Read - ET page 18
Read -ET page 19
Read - ET
Prayer Meeting for Dr.Mujumdar
The location of the Prayer Meeting for Dr.Mujumdar was the Admar Mutt in Andheri. It was a very solemn occasion. We had an audience of 100 persons.The family had arranged for a pleasing,smiling photograph of Dr.Mujumdar, duly garlanded. The meeting began at 5 p.m with prayers by the younger brother of Dr.Mujumdar--who sang lustily Ganesh Vandana and several other moving religious verses. He spoke briefly. This was followed by two cute speeches by the two granddaughters of Dr.Mujumdar--which revealed what a loving Grandpa he was.He induced in them a love for books, instilled a sense of discipline. The kids used to go for morning walks with the Grandpa as the walk would end with fresh tender coconut water !.
Since Sudesh, the son could not attend his message was read out by his sister Mamata--a touching tribute. Mamata spoke after this but could barely control herself. She made a deeply moving speech. Then we had tributes from Tarapore,Philip Thomas, Vasudevan,Shetty, one lady and myself. Impressive accounts were given of the intellectual attainments and outstanding personal qualities of Dr.Mujumdar. I also spoke and my speech is given below. Finally Shri Tarapore released the latest book of Dr.Mujumdar and gave the first copy to Smt.Mujumdar. She spoke a few words praying to the God that in her future janmas too she should have Dr.Mujumdar as her husband. The meeting concluded at 7 p.m.
- P.P.Ramachandran
PPR's tribute to "Bhishma Pitamaha " of DEAP
It is with considerable trepidation that I stand before you to pay my humble Tribute to the "Bhishma Pitamaha " of DEAP. We have gathered in such large numbers to mourn the sad demise on April 6th of Dr.N.A.Mujumdar. He was 84 years old. He served in R B I for over three and a half decades . He was a distinguished economist whose Ph D thesis from Mumbai University was highly acclaimed and published as a book titled: Some Problems of Underemployment. He has wide interests in rural issues , monetary and fiscal policies and international issues. He taught at Mumbai University and had the distinction of being awarded the prestigious Nuffield Fellowship at Oxford. On his return to India, he joined the Reserve Bank of India in 1960 as Research Officer, and retired as Principal Adviser, Department of Economic Analysis and Policy in 1988. He also headed the Monetary Policy Unit--the Brains Trust of the RBI. His services were sought by the International Monetary Fund for secondment to the central banks of five different countries—Zambia, Mauritius, Tanzania, Belize and Cambodia. No single person has had assignments to such a large number of countries. That was Shri.Mujumdar.
Dr.Mujumdar was an authority on Agricultural Economics and was the Editor of the Indian Journal of Agricultural Economics and the Honorary Professor at the Society for Development Studies. He is author of a number of books including two volumes on Indian Agriculture. His last book, was " India’s New Development Agenda."--a book bursting with radical ideas and presenting an incisive analysis of our problems.
He belonged to an elite group of economists,like Shri.A.G.Chandavarkar, Deena Khatkhate, Dr.K.S.Krishnaswamy, M.Narasimhan, S.S.Tarapore,etc who wrote with authority seminal articles published in the legendary “ Economic and Political Weekly ".
One thing common to Dr.Mujumdar, S.S.Tarapore, A.Vasudevan, S.L.Shetty and myself is that all of us have the same publishers—Academic Foundation. I got a call from Shri.Rituraj Kapila, M .D of the Foundation that Dr.Mujumdar’s latest book was in the process of binding. Unfortunately he did not live to see it released. Dr.Mujumdar had a dialogue on his new book with Dr.Uma Kapila ,mother of Rituraj, only two days before his death.The posthumous book is “Reinventing Development Economics: Explorations from the Indian Experiment”. Rituraj has sent me a copy for review.The book is an attempt at exploring the new aspects of development philosophy. Divided into six broad sections, it addresses the issues of: growth and development, monetary policy, banking policy, fiscal policy, food security and global environment, with reference to the Indian economy. The underlying main theme of all the articles in the volume is promoting growth which is all-round and inclusive, equitable and above all growth which ultimately leads to the emergence of value-based compassionate society.
Dr.Mujumdar’s Philosophy of Life is available in this new book. “One of the ancient scriptures of India, Brahadaranyaka Upanishad enjoins that our life must be guided by the following three “Da -s”. Da-myata, that is control yourself; Da-tta that is give to others; and Da-yadhwam, that is be compassionate. Thus we must practice self-control, charity, and be compassionate. The Bhagawad Gita enjoins us to treat others as you treat yourself . What is good for you is good for others; what is bad for you is bad for others. Learn to rejoice in doing good to all creatures. Inculcating these qualities among individuals will go a long way towards eliminating society’s sicknesses like corruption, improving the quality of life and in general evolving a caring and compassionate society.”
Our sincere condolences to the family. Their grief is shared by Dr.Mujumdar's wide circle of colleagues, friends and students. We pray that his soul rests in peace.
- P.P.Ramachandran
'Vested interest' in 'Public interest'
My View on "PRR invokes RTI in 'public interest'":
There is no logic or rationale for linking pension revision-an issue which has been remaining undecided for decades- and regular wage revision. Having got messed up, let us have a look at both the issues.
Pension revision:
RBI has a funded pension scheme. RBI Pension Regulations when introduced, it was accompanied by an assurance about periodic revision vide RBI circular of March 13, 1992. Even if GOI wants to bring about any change in periodicity of revision of RBI Pension, it is appropriate to allow the present revision(The 1997 revision though under implementation is according to GOI still in dispute) which is overdue even if the periodicity is 10 years.
Wage revision:
Historically, RBI wage revision follows wage revision in banking industry. Current negotiation between IBA and bank unions has not reached any finality. In the present scenario, various components of remuneration package will have to be revised at different intervals. If periodicity of revision of basic pay is to be 10 years instead of the present 5 years, the rise will have to be 30 to 40 percent against the present offer of 10 to 15 per cent. In any case all these should form part of the negotiation of the next wage settlement to be made effective from November 1, 2012 as the earlier settlement expired on October 31, 2012.
Why we are discussing this:
Because, some vested interests in the bureaucracy have successfully confused the thought process of decision-makers. I believe, Dr Raghuram Rajan is capable of independent thinking.
- M.G.Warrier
Disadvantage of having stubborn 'specialists'
My View on "Payment banks: RBI governor, deputy differ":
This is one disadvantage of having stubborn 'specialists' at the top of any institution. The Indian financial system has space for several types of institutions to serve different types of needs. This recognition was there, till, perhaps, the beginning of imported reforms circa 1991. The multi-agency system comprising cooperatives, banks in cooperative, private and public sectors and even the traditional money lender besides chit funds and other players which co-existed then were serving divergent needs of urban and rural clientele at that point of time. With reforms the role expectations changed and the focus shifted to strengthening and supporting private sector banks. Private sector banks were interested in the ‘creamy layer’ of the business and that explains their share remaining low in the total banking business. Right approach would be to re-invent the multi-agency system allowing institutions of various categories to grow and function, maintaining the overall health of the financial system. Post Offices and ‘payment banks’ should be allowed to play their role with appropriate regulatory and financial support where necessary. Each unit of any system should not be expected to be independently viable.
- M.G.Warrier
Raghuram Rajan’s tandava spells death for economy
......When Subbarao was RBI Governor, and followed Yaga Reddy's policy of seeking to emulate Jawaharlal Nehru in destroying domestic industry in India, then Finance Minister Pranab Mukherjee sought to knock some sense into the Central banker. However, because of backing from Prime Minister Manmohan Singh, who has been as dismissive of the travails of domestic industry as he is solicitous of foreign commercial interests, Subbarao refused Pranab Babu's request. Raghuram Rajan too has the backing of the individual who chose him for his current job, Manmohan Singh, which is why he is on his present destructive course. For any rational mind, growth and employment are as important as inflation targeting, which is why it is inexplicable why three successive RBI Governors have focused only on inflation, that too by........
Postal bank test awaits new govt
The high profile spat between the Reserve Bank of India and the finance ministry over converting India’s loss-making 1.54 lakh post offices under India Post into a bank is likely to be one of the challenging issues that the next government will have to handle......
New bank licences: Why RBI chose only two banks
.........Former deputy governor Anand Sinha once said, “We are painfully aware of the pitfalls (of industrial houses owning banks), but we will make sure that regulations are not subverted,” and he stuck to his words. The regulator’s reluctance to give licences to corporations is well-known but the way it has managed to stick to its stance despite agreeing to open the doors to companies under pressure from the government is remarkable. The credit goes to former RBI governor D. Subbarao as well as current one,Raghuram Rajan—.......
The challenge: a bank account for everyone
.........Financial inclusion is certainly not a new dispensation that Indian policymakers are craving. The nationalisation of banks in 1969 and the thrust on branch building that followed were attempts at including the financially excluded. Even in the previous round of bank licensing (in 2003-04) new players were directed to open branches in rural and semi-urban geographies.........
Indian Banks Arming Themselves To Fight the Rise in Cyber Crime
..........Addressing the annual conference ‘ITS Enabling The Digital World’ in Pune recently, G Gopalakrishna, Executive Director, Reserve Bank of India (RBI) pointed out that banks are not doing enough to create awareness amongst customers. In an age of EMV pins and Aadhaar (biometric validation), a lot is at stake. He urged banks to form risk management committees on the board levels in order to identify and specialise in tackling possible frauds.............
आईसीआईसीआई बैंक शाखाओं में ही पकड़ गए थे जाली नोट
......आरबीआई की गाइड लाइन के मुताबिक नकली करेंसी पाए जाने पर उसी दिन आरबीआई को सूचना देनी होती है और चौबीस घंटे में संबंधित थाना में एफआईआर दर्ज करानी होती है। बैंक ने इस मामले में घोर लापरवाही बरती। शाखाओं में नकली नोट मिलते रहे और बैंक ने आरबीआई और पुलिस को सूचना तक नहीं दी। आईसीआईसीआई बैंक के अफसरों ने ऐसा क्यों किया? इसके पीछे कोई साजिश है या लापरवाही? पुलिस इन्हीं तथ्यों की पड़ताल कर रही है। ............
ICICI Bank scales up fully-automated Touch Banking branches to 100
............."We have observed that an individual spends around 10 hours a day at work. It leaves very little time to do routine works including day-to-day banking. So, we felt the need to offer our customers an option of banking at theirconvenience and at any time of the day," .......
Country’s largest lender goes stingy in Kashmir
Contrary to central bank instructions on credit-deposit ratio, country’s largest lender, State Bank of India, is stingy in lending in Jammu and Kashmir while it mops up heavy deposits from the state. As against RBI’s benchmark of minimum 40 per cent credit deposit ratio mandatory for banks in Jammu and Kashmir, SBI has just 27.7 per cent............
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