..........Dr. Rajan brings to the job a degree of intellectual capital, perhaps unmatched by any of his predecessors. Still, in reconciling divergent views and revisiting his own, he has his work cut out. He must know by now that no RBI governor can afford to antagonise the finance ministry beyond a point. Nor can he afford to alienate the RBI community, one that is legitimately proud of its traditions and expertise and its standing in the world of regulators.
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.
Saturday, August 24, 2013
The new note on Mint Street
..........Dr. Rajan brings to the job a degree of intellectual capital, perhaps unmatched by any of his predecessors. Still, in reconciling divergent views and revisiting his own, he has his work cut out. He must know by now that no RBI governor can afford to antagonise the finance ministry beyond a point. Nor can he afford to alienate the RBI community, one that is legitimately proud of its traditions and expertise and its standing in the world of regulators.
Lower interest rates alone not enough to drive growth: RBI
The Reserve Bank of India (RBI) believes that in a scenario when non-monetary factors are impeding a robust revival in growth, lower real or nominal interest rates are not enough to stimulate growth. “Price stability and exchange rate stability are necessary preconditions to sustainable high growth. Furthermore, when non-monetary factors are impeding a robust revival in growth, lower real or nominal interest rates may not be just enough to stimulate growth,” said RBI's Executive Director Deepak Mohanty in his speech in Pune on Friday............
Ailing Economy – Wailing India
........Dr. S. S. Tarapore, an expert external sector economist and former Deputy Governor, RBI, had observed that Rs 70 is the appropriate level, a couple of months ago. I have argued on the basis of some facts, in the recent past, that there is scope for a substantial adjustment. There are many factors that play a role in exchange rate determination between two countries - illustratively, growth rates, interest rates, and inflation rates. The Indian economy is sliding seamlessly into lower growth rate while the US economy is beginning to strengthen...............
‘Food Security Idea Noble, But Timing’s Not Right’ - Bimal Jalan
Former
Reserve Bank of India (RBI) governor Bimal Jalan has raised red flags
on implementing the government’s food security plan at a time the
economy is battling fiscal stress, joining a chorus of influential
voices sounding caution on the legislation, widely expected to be a
money guzzler. Jalan, who spent time in Parliament as a nominated member
after stepping down as RBI governor in 2003, said that while the food
security idea was noble and had his support, it was important to launch
it when the government can manage the large costs associated with it..........
Read - ET
Subbarao’s legacy: He repeated history as farce and tragedy
Follow uniform holiday calender for CTS cheque clearing: RBI
Mumbai: The Reserve Bank Friday directed banks to adopt a uniform holidays calender to streamline cheque clearing system for Cheque Truncation System (CTS) centres in New Delhi, Chennai and Mumbai............
Financial exclusion, RBI style
.............Ask the average Indian household what is and has been its everyday inflation experience and what it expects on this front. Then look at what the RBI says it has “achieved” on this front. We will know the vast gulf. (The irony here is that households’ inflation expectations are also part of the RBI’s policy documents. But, these are simply ignored as the central bank pats itself on its inflation performance with respect to a price index which, even more ironically, has no relevance for the average household at all!) The conflict between what the RBI says and what it actually does is equally stark in its regulatory/supervisory role. Financial inclusion is a critical objective for us, the RBI says. Indeed, it should be when Census 2011 says that 50 per cent of Indian households do not have any banking services at all..............
Assurances from RBI are encouraging on the current account deficit
..........The assurances from RBI are encouraging but fear lurks in the minds of one and all. Will it go beyond Rs65 today, the last working day of the week? As we have said before, one school of thought strongly recommends the disposal of gold in the international market to meet the current account deficit challenge. And yet taking into account the fact that festival and wedding seasons are close at hand, the government may not decide on this option, though it would ease the situation a bit............
FM's Mumbai soothing today
............"He is meeting FIIs and chairmen of leading banks," a government official said, adding the minister would return to Delhi by the evening. Chidambaram is likely to reiterate that there is no intention of the government to impose capital controls. And, that last week's measures by the Reserve Bank of India were aimed at reducing volatility in the markets and quelling speculation on the rupee............
Fake Rs 1,000 notes increase 18%
You can never be too careful while dealing with Rs 1,000 notes. There has been a sharp increase in fake notes of this denomination during 2012-13, going by the number of notes detected. RBI’s annual report says 98,459 counterfeit notes of Rs 1,000 denomination were detected during the year, compared with 83,280 in the year-ago period. However, the number of total fake notes detected during the period come down to 4.98 lakh from 5.21 lakh in the previous year...........
Everybody’s talking rupee-I
The rupee is on everyone’s mind. What is the “fair” value of the rupee is a question for which no one has a definite answer. In one sense, that is correct. The fair value of the rupee is the value we see—what you see is what it is. Currency markets around the world are inter-linked with an aggregate volume of intra-day trading of about $4 trillion a day. So stop fretting about the value of the rupee—it will be what it will be.............
What RBI does to prop up the Re
..............Finally, the notion that the RBI should intervene presupposes the existence of ' A rate' - the equilibrium rate that the RBI might aim to achieve. However, this runs counter to the notion of a free market. In sum, there exists a trade- off between saving the rupee today, and saving the country tomorrow. By all counts, the choice for the RBI is clear.
Just let the rupee go
India’s currency has been in the news, not just here but
internationally. Its decline has spawned worry, anxiety, panic and also humour.
Two samples: on Rakshabandhan day the Rupee tied a Rakhi to the Dollar saying
“Meri Raksha Karo”! In one of the advertisement, the hero says “Thank God I
have a Dollar underwear. If it was Rupee brand then it would keep dropping!.”
To avert the seemingly bottomless fall of the Rupee the Reserve Bank of India
swung into action a few weeks ago...........
Debt recast: Takru to meet top bankers next week
With no let up in the number of companies seeking debt recast from banks, Financial Services Secretary Rajiv Takru will brainstorm with top bankers in Mumbai next week to evolve a framework to separate the wheat from the chaff. Due to concerns that corporates are taking undue advantage of the banking industry-promoted corporate debt restructuring (CDR) cell, the meeting is expected to examine whether an independent oversight committee needs to be constituted to vet debt recast proposals........
Six state-run banks fined for violating KYC, AML norms
In the third set of action on banks for violating the Know Your Customer and anti-money laundering guidelines, RBI on Friday penalised six public sector banks. Collective fines of Rs 6 crore have been imposed on these banks, and the highest penalty of Rs 2 crore was slapped on Dena Bank. The other banks are Allahabad Bank, Bank of Maharashtra, Corporation Bank, IDBI Bank and Indian Bank..............
SBI, PNB among 5 PSU banks charging customers for SMS alerts
...........In March 2011, the RBI had issued guidelines for banks to send online alerts to customers for all types of transactions, irrespective of the amount, involving the usage of cards. "RBI has reported that it has not issued any guideline on charging by banks for providing these alerts to their customers," the Minister said. He also said "no proposal is under consideration of the government to withdraw the charges levied by banks, for this purpose." Chidambaram said it is not compulsory for an account holder to provide a mobile number. If the mobile number is given and the customer wants SMS facility, the bank provides the alerts............
Lend liberally to women SHGs: Nabard CGM
Karnataka has more than 90 lakh bank-linked self-help groups (SHGs) and nearly 80 per cent among them are led by women with more than nine crore members, said G.R. Chintala, Chief General Manager, Nabard-Karnataka. Interacting with self help group members of Karnataka Vikas Grameena Bank (KVGB) at Dharwad, Chintala urged the bankers to distribute loans liberally to members of women self-help groups (SHGs) and joint liability groups (JLGs) so that they could achieve economic independence...........
Nagrik Sahakari Bank, Indore penalized
....The urban cooperative bank was found involved in the violation of RBI directive and section 36(1) of the Banking Regulation Act, 1949 (AACS). The matter related to loans and advances to directors and their relatives and the firms/concerns in which they are interested and operational instructions issued to the bank by RBI respectively..............
BJD MLAs disrupt assembly over special category tag for state
............The BJD MPs in New Delhi met Reserve Bank of India (RBI) Governor designate Raghuram Rajan to apprise him on the state's demand. Rajan is heading a committee set up by the Centre to consider fresh indicators for according special category status to states. "It is most unfortunate that the Union minister Rajeev Shukla has denied Odisha's rightful demand for special category status. We will continue in our rightful struggle for the demand of more than 40 million people of Odisha for special category status for our state," said Chief Minister Naveen Patnaik.................
Introducing 'Islamic banking'
Islamic banking has been approved by RBI in India. This welcome development was expected after Dr. Raghuram Rajan took over as the governor of RBI, replacing D. Subbarao whose position on Islamic Banking was not favorable. Dr. Raghuram Rajan, a former Chief Economist of IMF(International Monetary Fund) and the Chief Economic Adviser to the Finance Ministry, was head of the high level Committee of the Financial Sector Reforms-CFSR of the Planning Commission, which recommended Islamic Banking to be approved in India. So, when on August 6, 2013 Dr. Manmohan Singh approved Dr. Raghuram's appointment as the governor of RBI, people like me got fresh hopes, and RBI finally gave a 'Go ahead' to it...............
Read - Greater Kashmir
Read - Greater Kashmir
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