.........The Reserve Bank of India (RBI) plans to mobilise the unused gold by lending it to importers and exporters of the yellow metal, in a move it hopes will bring down the demand for physical gold. It wants banks to encourage products linked to accepting physical gold as deposits and investing public money in gold related products, and extend loans against gold as collateral..........
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, February 4, 2013
RBI to quiz YES Bank on Monday over cyber-fraud
YES Bank will offer an explanation to the Reserve Bank of India (RBI) on Monday detailing the circumstances that led to a cyber-fraud in one of its customers' bank account, sources in the central bank said. Ankur Korane, a customer of YES Bank's Mulund branch, had claimed that Rs 1 crore was stolen from his bank account. The money was transferred from his account through real time gross settlement (RTGS) system..........
What is Cheque Truncation System
........Some banks also created awareness through various modes of communication like SMS alerts, letters, display boards in branches and ATMs, pop-up messages in internet banking and notification on website. All this is because we are moving from an old format to a new format of cheque clearance in India...........
SEBI plans colour-coded MF products
In a bid to caution people about the risks associated with a certain mutual fund product, SEBI is planning to introduce colour- coded mutual fund products to depict the level of risk involved with the instrument, according to a senior official of the capital market regulator.............
Saturday, February 2, 2013
RBI: Growth slowdown not commensurate with inflation control
............ “While monetary policy action addresses the risk of unhinging of inflation expectations, attending to the structural supply constraints becomes important to ensure that these do not become a binding constraint in the long-run, making the task of inflation management more difficult. By ensuring a low and stable inflation, RBI could best contribute to social welfare,”.................
Indian Inflation Puzzle
Acceptance Speech by Shri Deepak Mohanty, Executive Director, Reserve Bank of India, in the function of Late Dr. Ramchandra Parnerkar Outstanding Economist Award at Mumbai on January 31, 2013
..............I take this opportunity to share my thoughts on the topic of inflation which affects one and all. Over the last three years the persistence of inflation in an environment of falling economic growth has come out as a “puzzle”. In my presentation I propose to address the following questions: What do I mean by a “puzzle”? Why do we need to worry about inflation? What is the nature of the current inflation process? How did monetary policy respond to the recent bout of inflation? I conclude with some thoughts on the way forward to achieve price stability.............
Read...........
..............I take this opportunity to share my thoughts on the topic of inflation which affects one and all. Over the last three years the persistence of inflation in an environment of falling economic growth has come out as a “puzzle”. In my presentation I propose to address the following questions: What do I mean by a “puzzle”? Why do we need to worry about inflation? What is the nature of the current inflation process? How did monetary policy respond to the recent bout of inflation? I conclude with some thoughts on the way forward to achieve price stability.............
Read...........
Forex: 20 years of pride & prejudice
.....Then, from 1991 to 1997 the forex market was stewarded through a process of LERMS, unified exchange rate and managed float (old timers would remember the famous 31.37 rate) and trade account convertibility into a floating rate regime by stalwarts such as O. P. Sodhani, S. S. Tarapore, Shyamala Gopinath, Usha Thorat, G. Padmanabhan and Y. V. Reddy. It was a period of pride (and some prejudice) as the RBI won plaudits the world over for piloting India’s external sector through turbulences.......
RBI wants special force to guard banks’ currency chests in state
In the wake of shortage of security personnel to guard currency chests in Gujarat, the Reserve Bank of India said Friday it is examining a proposal to set up a dedicated security force for the purpose. "We are examining a proposal to set up a dedicated security force for guarding currency chests of banks in Gujarat. The proposal is at a very preliminary stage," Regional Director of RBI Sudarshan Sen said........
Handle with care
...... The government will have to continue to do what it has to mitigate the twin deficits. To paraphrase the late Milton Friedman, economist and Nobel laureate, monetary policy is a string: one can pull it to rein in inflation, but one cannot push it to revive economic growth by itself.
RBI asks banks to beef up wage hike, pension provisioning
The central bank's move comes as the next wage revision kicks in from November
The decision on increase in wages and pensions in public sector banks is more than a year away, but the Reserve Bank of India (RBI) has already asked banks to start making adequate provisioning. That’s because banks will have to pay arrears from November 2012, even though the Indian Banks Association has informed banks that an agreement with unions on wage revision will be reached by March 2014.............
US Exim Bank's plea for recovery powers with RBI
The Export-Import Bank of the United States has sought powers from the Reserve Bank of India (RBI) for recovery under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act. Its application is pending with RBI. Fred P Hochberg, chairman and president of US Exim Bank, said the bank had held discussions on the issue with RBI and the finance ministry. Hochberg, however, didn’t specify when the bank had approached RBI and what RBI’s response was..........
Economy would be stronger when more people have jobs: KC Chakrabarty
.......... I would share my perspective on the necessity for promoting financial literacy as a policy tool, its centrality to ensuring inclusive growth and the initiatives we have taken in India for promoting financial literacy. But before I venture any further, let me quickly state what is meant by ‘Financial Literacy’. I quite like the definition given by the INFE researchers, Atkinson and Messy, who describe it as “a combination of financial awareness, knowledge, skills, attitude and behaviours necessary to make sound financial decisions and ultimately achieve individual financial wellbeing.” Thus, an absence of financial literacy can lead individuals to make poor financial decisions that can have adverse effects on their financial well being..............
About time RBI acted
............It's not clear why it was necessary for RBI to make the point that bankers shouldn't 'artificially' reduce the net present value of cash flows by resorting to any sort of 'financial engineering' while calculating the diminution in the fair value of the exposure. The comment reflects poorly on banks suggesting that they haven't always played by the book. They will from now on, since..............
‘This rate cut will also be discounted due to inflation’
.....The significant point is, we will not be able to sustain consumerism because interest rates will stay elevated. The focus of the RBI should remain inflation. Can anyone tell me now that the rate has been cut by 25bps, will India grow its balance sheet (GDP)? There is no linkage between interest rate and growth rate in the short term. Had the RBI cut the rate six months down the line instead of now, the impact on the yield curve would have been substantially bet en you would be convinced a sustained rate cut cycle is upon us. Not now. After the repo rate was cut by 50 bps last April, inflation went up and in the end, that rate cut got completely discounted........
FM will get a bigger bank recap bill, courtesy RBI
The finance minister is not going to get his free lunch from Duvvuri Subbaro, despite the fact that the latter cut both repo and cash reserve ratio on 29 January to please him. The obverse side of easier money and credit is always a higher complement of bad loans. And more bad loans means more capital. What P Chidambaram gained by way of cheaper loans will have to be repaid to banks as higher capital infusion from the government..........
India to take baby steps towards gold-linked products
The RBI plans to introduce three to four gold-linked products in the next few months, in an effort to bring 20,000 tonnes of gold held in households into the banking system, but the measure is unlikely to cut bullion imports sharply, a senior official said..................
NABARD has turned anti-poor, says Dasgupta
............The “evidence shows that Nabard’s shift in priorities is directly linked to the leadership of its chairman, Mr. Prakash Bakshi, who, in a significant deviation of policy, included private entities as eligible institutions without consulting the RBI, via a circular of September 27, 2011,”...............
Why Mr C’s finmin should not rob Grandma to boost growth
The finance minister wants interest rates to be reduced steadily in order to push up growth and investment. The Reserve Bank of India, despite being unconvinced on inflation and the current account deficit (CAD), has obliged recently by cutting repo rates. But the story, it seems, is going to get worse. Today’s Business Standard reports that the finance ministry wants banks to cut the differential rates offered on fixed deposits (FDs) held by senior citizens. Banks currently offer senior citizens rates that are higher by 0.5-0.75 percent depending on tenure and their own need for longer term stability on funds. But P Chidambaram’s ministry is trying to rob grandpa and grandma in its quest for lower interest rates so that the investment climate gets better...........
Friday, February 1, 2013
Does RBI know whether it’s coming or going
..........Almost everyone has welcomed the easing. After all, something is better than nothing. However, much less appreciated is that in its policy statement the RBI has been consistent in being inconsistent. There seems to be a pattern of inconsistency in the RBI’s actions and the related analysis/guidance. Thus, for example, when it wants to communicate a hawkish tone, it’ll often hide behind the uncomfortably high Consumer Price Index (CPI) inflation. In contrast, when it wants to ease or sound dovish, it barely even bothers to extract any message from the CPI inflation...........
Using cheques to settle transactions may be a thing of past; RBI wants to disincentivise cheque usage
.......In an attempt to discourage paper based transactions and promote electronic settlements, the Reserve Bank of India has made sweeping suggestions in a discussion paper placed on its website on Friday. These include a charge on cheque books and even a fee for settling certain kinds of transactions..........
RBI's new policy to give fillip to development with customer as focus
Nashik, Jan 30 : Reserve Bank of India (RBI) new economic policy has created a positive flutter in the market and will give boost to economic development, stated RBI economic consultant Dr Ashutosh Raravikar. He was speaking after inauguration of Nashik Industries Manufacturers'Association (NIMA) bank summit 2013 in Nashik today...............
RBI comes up with comprehensive financial literacy guide
To create financial awareness, educate common people on management of money
In order to cater to the need of financial literacy the Reserve Bank of India (RBI) has prepared a comprehensive financial literacy guide. This guide contains operational guidelines which clearly spell out the manner in which financial literacy camps should be conducted so as to synchronise it with providing financial access and thus linking the financially excluded section with the banking system...........
RBI confident of infrastructure investment target
London: India is on course to meet its infrastructure investment needs of an estimated USD 1 trillion over the next five years, according to Reserve Bank of India (RBI) Executive Director G Padmanabhan. "The funding process is working in a seamless manner and things have taken off in a very exciting way," he said at a conference here on Wednesday.............
FinMin: Cut FD rates for senior citizens
The finance ministry has asked government banks to reduce the fixed deposit (FD) rate offered to senior citizens to reduce cost of funds. At present, most public sector banks offer 50 basis points more to senior citizens than what they offer to others. Some private sector banks, like ICICI Bank, offer 75 basis points more to seniors. The finance ministry has demanded an action-taken report from banks on how they have progressed on this front..............
RBI conducts awareness prog in Dimapur
......David Kire, Chief Manager (Lead Bank), SBI while acknowledging RBI Guwahati for organising the programme, added ‘today the banks are highly quipped with technology like ATM, credit card, debit card, internet banking but along with it, the crooks are trying to take advantage of technology for which awareness is needed.’ Arpita P. Biswas, DGM DNBS (RBI) Guwahati said in her speech that RBI could give license to banks and non-banking financial company. In Northeast 118 non-banking finance company are registered in RBI and three from the state of Nagaland. Dr Dilip Singh, AGM ID RBI Guwahati, Pathagata Basu, GM, DNBS (RBI) and PN Murthy AGM DNBS made presentations...........
Siddhu - The perfect gentleman.......
 |
| At the centre of the helm n looking straight at you Siddhu - V.K.Siddham |
- Ashok Jangam, Private Secretary, RPCD, Mumbai
Photo courtsey - Girish Satam, AM/ Asmita Kale, PS
Photo courtsey - Girish Satam, AM/ Asmita Kale, PS
Ever smiling but hard working Kuldeep ..........
My friend, philosopher and guide Shri
Kuldeep Singh Wadhwa, a senior Private Secretary of our PS Fraternity
retired on January 31, 2013 after putting in 40 years of meritorious service.
He was attached to the Regional Director, Lucknow. His personality has touched
me a lot. Always smiling, Kuldeep guided me as my elder brother when he was
posted at New Delhi office in Governor's Secretariat. I enjoyed working with
him and his support always brought cheers for me. His dedication towards office
was superb which inculcated a sense of hard work amongst other colleagues. He
brought laurels to the office and took his office to new heights during his
stay at New Delhi. I wish him a very peaceful, happy and healthy retired life.
- Pawan Kumar
PS to Chief General Manager & BO, New
Delhi
Gentle, Gregarious, Kind........
I was head of the Urban
Banks Department in Trivandrum in the late eighties. One day I got a message
that Kum I.T.Vaz, the Head of the Urban Banks Department in Central
Office, Bombay was paying a visit to our office and I should receive her
at the airport and make necessary arrangements. I went the next morning to
the airport with an Ambassador car and was waiting. The Bombay plane landed and
a little later passengers started flowing out. I could spot my boss from
a distance and waved my arm. Kum Vaz came near the vehicle and after entering
she said, “Mr. Ramachandran, I was wondering whether you would be able to
recognize me—since we have never met !.” I said with a smile, “You are
unforgettable, Madam !”. Kum Vaz blushed and was astonished to hear this and
asked promptly, “How?”. Coolly I replied, “Madam, because of you, I walked
in the hot sun from RBI Main Building to the Governor’s residence off Peddar Road
— eight miles away. Because of you I
lost one day’s wages. Because of you my increment is postponed by one
day!”. She exploded into laughter and said, “This is the first time someone has
told this to my face. All utter it behind my back. I am sure we will get along
well!”. She made three more trips to Trivandrum. There was an Association
sponsored agitation against her promotion.
In Trivandrum Miss Vaz was
keen to meet the wife of K.Madhav Das--the famous malayalam poet Madhavikutty. I
took her to the poet's house and they chatted happily for an hour like
college girls ! Officially we visited the Nedumangad Urban Co-operative Bank.
She asked the Chairman what was his profession? I translated her question
into Malayalam. Without batting an eye-lid he said--" Rashtriyam ".
Translated into English it was "Politics". Miss Vaz expressed
shock--but I assured her most of the co-operative banks are off-shoots of
politicians. I reminded her of the sugar barons of Maharashtra with their
strong urban banks.
Miss Vaz was one gentle,
gregarious, kind person. It was a privilege to work with her.
- P.P.Ramachandran
Best tribute........ Vaz was
Shri Khot's tribute to Ms. Vaz (VITALINFO 31/1/2013) is excellent and the best as I could not find either substance or warmth in the tributes paid by others. I am not surprised at all as Shri Khot's thoroughness of disposals and drafting were found by me to be of a high standard even when he was at the bottom of the hierarchy in the RBI. He should have risen to a much higher position in the RBI than he actually did. This has become a tribute to Shri Khot! This is okay as I have got an opportunity to write about him!
- A. Chandramouliswaran
RBI is doing too much too soon: Latha Venkatesh
Q. RBI Governors both YV Reddy and Mr Subba Rao have held the economy together despite immense pressure to be populistic. Your views on this pls Asked by: eega
A. I agree with you. (I would add Jalan and Rangarajan to this list. Before them, I was not following the RBI) Our country has been lucky to get RBI governors who are honest men. Men of integrity.
Q. Why is Subba Rao so adamant about cutting the interest rates? Asked by: Priya
A. You mean he is cutting rates too soon. I agree, he needn't have cut repo and CRR. Only repo would have done. I too think he is too dovish. He probably believes growth will solve a lot of problems. But the easy money policy is bringing more inflation not more growth..............
Chiranjeevi welcomes RBI's decision to allow hotels to repay loans through ECBs
Union Tourism Minister Chiranjeevi has welcomed the decision of the Reserve Bank of India (RBI) to allow Indian companies in the hotel sector to avail benefits under the External Commercial Borrowings (ECB) scheme to repay their outstanding rupee loans and or to finance fresh capital expenditures.........
RBI does its bit, will govt step in too?
Nine months after it last cut the repo rate, or the rate at which it lends money to banks, the inflation-fighting Reserve Bank of India (RBI) has announced a 25 basis points (bps) cut in the key policy rate to 7.75%. The RBI seems to have lessened the gap between promoting growth and containing inflation with this move. With the ball now in government’s court, will it work towards developing better policies and improve basic infrastructural needs. Speak Up finds out.........
Read - DNA
Read - DNA
FM meets financial sector regulators ahead of Budget
NEW DELHI: Finance Minister P Chidambaram today discussed the issues concerning regulatory environment and deliberated on steps which could be taken in the Budget in a meeting with financial sector regulators. "We gave suggestions for Budget from our respective point of view," RBI Governor Duvvuri Subbarao told reporters after the meeting here. .......
Open Up Banking
...........The main argument against
bank licenses to corporate groups is the apparent conflict of interest
and diversion of funds to promoter-owned or related companies. Such
arguments are deceptive as the draft licensing guidelines lay stress
on credentials and track records of promoters, ensure more independent
directors and also ring fence banking from other group activities. In
fact the clash of interest argument is more applicable to public sector banks that are victims of political pressures.....
Transforming Lives of Informal Sector workers
After conducting the workshop on Community Consultation on Financial Inclusion for Urban poor on 7th December, 2012, Nidan staff went to many public sector banks and briefed them about the RBI circular and thereafter the opening of bank accounts have become very easy as the bank officials are now willing to open bank accounts of the unorganized sector without any restraint, this has helped in bringing the marginalized workers of the unorganized sectors into the mainstream, where they can now have accesses to various financial services. As suggested by RBI Deputy Governor Dr. K.C. Chakrabarty regarding opening of bank accounts in “Camp Mode”, the first camp in Delhi, was organized at Shahdara, Delhi.Total 70 bank accounts were opened on 23rd January 2013. Another camp was organized on 24th January ...........
RBI raises bar for banks on corporate debt recast
.....“It has now been decided to increase the provision to 5 per cent in respect of new restructured standard accounts (flow) with effect from April 1, and in a phased manner for the stock of restructured standard accounts as on March 31,”......
Resistance is natural when you change: DK Mittal
......."Occasionally, there are concerns over the government exercising its
ownership rights not through the established channel, which is the board
mechanism, but outside of the board," RBI Governor
D Subbarao once said, without citing any specific case but making it
clear that he was referring to directives from finance ministry to the
banks. Most bankers, however, said there was much to appreciate
in the work done by Mittal. "He has done a really good job. Perhaps the
instances of micromanagement could have been avoided,".........
Takru to meet PSB chiefs on Feb 5
........In his first interaction with bankers, Takru would also review the progress of banks’ financial inclusion plans. Earlier, banks had been asked to prepare financial inclusion plans duly approved by their boards. Under the financial inclusion programme, the Reserve Bank of India has mandated banks to extend financial services through branches or business correspondents to 73,000 villages with ...........
Inflation Index Bonds: Issues and challenges
....Issuance of inflation indexed bonds in India is full of challenges for RBI. The first and the most important challenge come from the fact that we have two indices which are used for calculation of inflation. One is Wholesale Price Index (WPI) and the second is Consumer Price Index (CPI). Which one should RBI use for benchmarking inflation indexed bonds? This is a dilemma which many governments internationally have faced......
Tamil Nadu banks set to get 1,000 cr after RBI cut
....The cuts will infuse an additional Rs 18,000 crore into the banking system. Of this, Tamil Nadu's share is expected to be slightly over Rs 1,000 crore. City-headquartered Indian Overseas Bank (IOB) is expected to get Rs 475 crore. "This infusion will help us generate an income of Rs 48 crore over one year," M Narendra, chairman and managing director, IOB, said......
Thursday, January 31, 2013
Brace For A Blowout
..............The irony is that Thorat feels the RBI has diluted her committee’s views in its draft! BW learned from sources that Thorat wrote to RBI Governor Duvvuri Subbarao last month that the idea behind exemption from a certificate of registration (CoR) was to ensure these NBFCs were not robbed of their legitimacy, but would not have a CoR to misuse. If you are on RBI’s radar, play off the reputation it confers you. The RBI’s draft says NBFCs will have the option to surrender the CoR on a voluntary basis and also be out of its regulatory radar (RBI Act 1934, except Section 45N). She raised the existential with Subbarao: “Is it legally possible to say that the law dealing with NBFCs is not applicable to such companies? Maybe this needs to be clarified.” ................
RBI, heal thyself
........it is encouraging to note that other analysts have also picked up on this theme, that the signature of the present RBI is that it not only indulges in obfuscation (which is good for a central bank) but also bundles itself into contradictions, and the changing of policy goalposts, which is a real bad. And bad because it severely erodes the RBI's credibility. We have a new addition to the ever-increasing set of goalposts of the RBI............
Why aren’t banks taking RBI’s cues?
.........Although RBI has flagged the lack of monetary transmission as an area of concern, it has done little to ensure that consumers benefit from the steps taken by it. Even the finance ministry, which has trained its gun on RBI to cut rates, has also failed to convince state-run banks to ease rates and help borrowers access cheaper loans. Obviously, banks have their own reasoning. For instance, they say that the repo rate cut is only a signal as most of them make only limited use of RBI's overnight borrowing window...........
Subbarao throws water on next cuts
....A day after announcing a 25 basis point cut each in the repo rate and the cash reserve ratio, RBI governor D Subbarao threw water on hopes that with inflation trending down, there would be more policy cuts in the months to come...........
RBI rate cut is a washout
....... The Reserve Bank of India (RBI’s) policy response has been based on the assumption that inflation has moderated. Or, should we say the banking regulator has finally succumbed to the pressures of New Delhi? The cornered RBI has had to acquiesce during one quarter or another. To be fair to the monetary authority, how long can it hold on to the government’s pressures? ................
Chidambaram welcomes RBI rate cut, promises more government action
..........."They (RBI) have taken the call now, they have given the reasons...and I welcome the decision. But interest rates (are)... one issue that India faces. There are many other issues that have to be addressed and I hope we can address them in the days ahead,"................
My View on "Vaz was..............."
I, too, am grieved at the sad demise of Madam I.T.Vaz. As I had heard, she had a
meteoric rise in the Bank's hierarchy. She had appeared for selection
before a Board (perhaps, for Probationary Asstt's post) and the Board
was so pleased with her performance that she was selected for the next
higher grade! Later, in the early 1990s, she was elevated to the
position of ED, the first lady officer to have broken the glass ceiling
to reach the top position. After the combined seniority was implemented,
many ex-ACD officers had excelled in various positions in different
departments. Since managerial experience was a pre-condition for elevation
to ED's post, she was posted to Ahmedabad as Manager.
When the book project "Mint
Road Milestones: RBI At 75" was under way, as part of the Platinum
Jubilee celebrations, we had called on her at her residence for getting
any photos / material concerning any landmark events in the Bank's
history. She had allowed us free access to her rich and valuable
collection of photos etc. and also shared her memoirs and offered us help
and guidance. Some of these photos adorn the pages of the book. We
were moved by the kind courtesies and hospitality extended by her to
us despite her indisposition. I fondly cherish those delightful
moments. She did compliment to us on release of the book. Her demise
is a tragic loss to us. Her memories will abide with us. May the departed soul rest in peace!
- S.M.Khot
My View on "Missed u so much............"
Dear Mangesh
While we should appreciate the sentiments of those who have become addict to VITALINFO, I would suggest, when it comes to priorities, this kind of ‘extra work’ should not be allowed to interrupt your normal life and you should put the interests of self and family always first. Whenever VITALINFO disappears for a day or two, you are more than making up by taking trouble to update us even about the happenings on ‘holidays’. Many thanks. Enjoy the day and take care.
- M G Warrier
Shri warrier is so right. Dear Mangesh should have some respite when he is occupied by some personal work. The anxious enquiries about the Newsletter from his readers show that they consider that the day has not begun all right without the Newsletter! I would take this opportunity to say that Mangesh should not hesitate to publish views critical of the RBI as those who air such views found, while in service, that such views fell on deaf ears!
- A.Chandramouliswaran
Manmohan to release coins on J&K shrine board silver jubilee
The Prime Minister will release two commemorative coins specially designed by the Reserve Bank of India — and which have great significance for Jammu and Kashmir — to mark the silver jubilee of the Shri Mata Vaishno Devi Shrine Board (SMVDSB) in New Delhi on Thursday. According to highly placed government sources, Dr. Manmohan Singh will release two coins, of Rs. 5 and Rs 10 denominations, which will have the embossing of the form of the revered Mata Vaishno Devi, who is believed to be the eldest deity among the six other Devi shrines between the Yamuna and the Chinab rivers in north India........
Fake notes get into liquor shops
Chennai: With Tasmac liquor outlets being flooded with counterfeit currency, the RBI has joined the CB-CID in training their staff to detect fake notes. “Tipplers throng the Tasmac outlets at all times of the day, keeping the staff on their toes and leaving them with little time to check on the notes given. This makes it easy for customers to use them here,” say sources in the counterfeit currency wing of the CB-CID. ...............
Banks detect fake currency in collections
INDORE: Large number of fake currency notes recovered by various branches of ICICI bank in the Malwa region during the past quarter has pointed to the operation of a organised racket circulating fake currency in the region. Police have also confirmed the fact and are investigating the matter........
' Risk averse banking' must give way to ' responsible banking'
.... Risk averse banking' in credit deployment has to give way to ' responsible banking' complying with the twelfth plan vision. The global risks are transmitted to the financial market mainly by volatile capital flows and crude oil price through the exchange rateinterest rate channel. To minimise this risk, the action of monetary policy has to be complemented by a relevant fiscal and external sector policy. The way forward Assuming that the above mentioned risk factors have been managed by stakeholders, the following three monetary policy objectives, viz., to encourage investment, anchor medium term inflation expectations and improve liquidity conditions to support growth, have to be achieved. In this context, can we envision an 8% growth, 6% inflation, 6.5% policy repo rate and 3% CRR by 2014- 15? To conclude, frontloading of monetary policy through rate reduction should be avoided and the ' baby steps' approach may be considered......
Reddy charts five-pronged strategy to revive growth
...............Reddy hinted that the government may hand over the financial sector control to the RBI. In this context, he cited the case of the UK, where financial sector regulation has been handed over to the Bank of England. “In England, there was a separate regulator for banks. Now, they all (financial sector regulators) were brought under Bank of England by law.” In fact, a single financial sector regulator was contemplated by the Indian government some time ago, he said. “If you were to reform the financial sector in India, there were lessons to be learnt from global experiences. Earlier, the concentration was inflation targeting and independent monetary policy. Now, somebody should be in charge of the nation’s financial stability. The central bank should be in charge of that,” he said.............
In conversation with Dr Y.V. Reddy
Former RBI Governor Y.V. Reddy talks about the issues raised in his new book "Economic Policies & India's Reform Agenda - A New Thinking."
Nizams' jewellery need conservation: Australian writer
HYDERABAD: Australian writer John Zubrzycki, who penned the biography of the 'original owner' of the Jacob Diamond expressed concern at thefabulous jewellery of the Nizams being locked up in the vaults of the Reserve Bank of India and said the unique pearls in that collection could get damaged if they are not treated for conservation.............
State electricity boards' second debt recast to get provisioning benefit
..............According to the newly appointed Deputy Governor of RBI Urjit Patel, monetary policy and fiscal policy both impact aggregate demand and therefore both have implications on the current account deficit. The CAD has widened primarily due to worsening of trade deficit. “In a slowing economic growth high trade deficit is a matter of concern and shows some imbalance. So partly this could be that lot of domestic production is getting substituted by imports,” said Deepak Mohanty, Executive Director, RBI............
India repo window won't turn surplus even if govt spends all balance: cbank
The Reserve Bank of India's daily liquidity adjustment facility will not turn into surplus even if the government spends all its surplus cash balance, Executive Director Deepak Mohanty said on Wednesday..........
Corporates meeting norms to get banking licence: FM
......."The RBI has drawn up draft guidelines, guidelines say that more licences will be given to the private sector... the governor told me he will give out guidelines in two weeks," Chidambaram told Reuters Television in an interview in London on Tuesday: "Whether any corporate or any kind of corporate will be excluded I cannot say." "But if the guidelines are made out and transparently spelt out and if a corporate satisfies those guidelines, I don't see any reason why a corporate should not be given a licence."......
NABARD launches ‘Credit plan 2012-17’
..............Besides the credit outlay in the priority sector, the State Focus Paper also discusses the sectoral issues for development, replicable practices, success stories and suggests action plants for state government and bankers. R Amalorpavanathan, chief general manager, NABARD, Kerala, in his presidential address, urged the bankers and government officials to expedite the completion of electronic benefit transfer by March 2014. K R Rao, general manager, NABARD, welcomed the participants. V S Senthil, Principal Secretary, LSGD; V S Sudheep, DGM, RBI; G Sreeram, GM and convenor, SLBC and other senior executives representing banks and government departments attended. G Janaki, DGM, NABARD, proposed the vote of thanks.
Wednesday, January 30, 2013
A cornered RBI acquiesces
Efforts to revive growth have to come from the govt, as modest attempts like this one by RBI remain insufficient............
Read - Mint
It’s not govt vs RBI, but a difference of opinion: Reddy
Risks are real, benefits not certain: Y V Reddy
...............It isn’t bad news if successive governors think alike. In fact, (C) Rangarajan, (Bimal) Jalan, me and Subbarao all think alike and it is good for the country. For 20 years, governors of the central bank, by and large, have thought the same way. So, we will have good financial stability and a good financial sector. You should be happy. You should always have a mutual admiration among successors and predecessors and not a mutual hate society............
RBI cuts interest rates for first time in 9 months
Shedding its 9-month long hawkish monetary policy stance, the Reserve Bank of India on Tuesday slashed its key interest rates by 0.25 per cent and released Rs 18,000 crore additional liquidity into the system to perk up growth through reduced cost of borrowing. RBI Governor D. Subbarao in the third quarter monetary policy review surprised the market by cutting repo rate by 0.25 per cent to 7.75 per cent and cash reserve ratio (CRR) by similar margin to 4 per cent.........
Vaz was................
In
the golden light'ning
Of
the sunken sun,
O'er
which clouds are bright'ning,
Thou
dost float and run,
Like
an unbodied joy whose race is just begun.
Goodbye
Blithe Spirit
- Sanjeev Sharma
She
was once to Patna office in 1993 if I recollect fine. On her way to the Patna
airport she wanted if we have packed a lot of food and beverages as she
expected the flight will be delayed. She turned around the other ED (Kumari
Vishwanathan and said she does not need any eatable for she had never seen her
eating anything. That is I T Vaz. Great character she was.
- Manas Mohanty
I am very
much grieved to learn about the sad demise of Miss Vaz. I knew her since my BTC
days i.e. mid-sixties, when I was a tutor there and she used to visit as a
guest speaker. My real association with her can be said to be since
1992, when we used to work as E Ds and occupy the same 17th floor cabins. She
was intelligent, no doubt, but had the guts to put across boldly what exactly
she failed on issues. This is a sign of intellectual honesty. After retirement,
whenever she visited Pune, she used to call on me and I used to at least ring
her up during my short visits to Mumbai. Every Diwali, she used to send
me greetings unfailingly, which I used to reciprocate at X’mas. Last time I
wrote to her was in December 2012. I did not however get any reply and was
indeed worried. The worst has come true. I have lost a good colleague. May God
rest her soul in Peace.
- P.B.Kulkarni
[Pune]
“May
her soul rest in peace” won’t be acceptable to Madam I T Vaz ! She never
tolerated injustice… But she found injustice around, above and below. I am
sure, she will continue her fight and that trust will help those who knew her
to carry on the fight!
- M.G.Warrier
Sad to learn about Ms Vaz's
death. May her soul rest in peace. In 1968 she was my ACO in ACD where Iwas
posted as JO Gr II as part of my training. Thereafter in 1995 she was my ED
when I was CGM in-charge of Financial Institutions Cell. I
found her to be clear headed and bold in her work. I remember once I had gone
to discuss some matter with her in her room on the 17th Floor. She had just
returned from DG (D.R.Mehta)'s room and was furious after having a tiff with
DG. She said that what did he think about himself that he is an IAS and
can get rough shod over ED. Such was her demeanour.
- Man mohan
Singh Rekhrao
Extremely
sad to know about her sad demise. I had seen her several times in Garment House
where ACD was located. She was ED during the tenure of Dr I.G. Patel. Graduated
from Sydenhem College, interviewed for the post of Economic Asst, she was
offered the post of Officer because of her brilliant knowledge. She was an
epitome of grace and etiquette.
- Sitendra
Kumar
Obituary
Mr. P. Arumugam, Retd. Gr. ‘B’ Officer, RBI, Chennai passed away on 15.01.2013. Mobile: 91768-96036
Missed u so much............
 |
| VITALINFO could not be updated for 5 days since I was on family vacation. I received several calls, e-mails and sms asking reasons for the missing VITAINFO. I am short of words to thank all the avid readers of VITALINFO................... |
‘Central Banks’ Autonomy is an Overrated Fiction’
....I
believe the autonomy of central banks is a fiction. I also believe it is
much overrated. The question in the political economy of central
banking is “independent of whom?” central banks are deeply political
institutions and it is disingenuous to pretend otherwise. The struggle
to determine how they should allocate credit and to whom is very
emotion-charged and important to examine closely. Should central banks
be independent of humans in the name of some abstract notion called
price stability? If so then what is the value of price stability in
bettering the lives of the citizens? .......
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