'The RBI is something like a seat belt. As a driver, the driver being the government, it has the possibility of not putting on a seat belt but of course if you do not put on your seat belt you get into an accident and the accident can be quite severe,' Raghuram Rajan told CNBC TV18. 'The aim of the board is to be Rahul Dravid -- sensible, thoughtful and not, with due respect, Navjot Sidhu,' he added.
RBI data show one-fifth of all the infrastructure loans are stressed and the share of such loans in overall stressed assets is nearly a third.
In case the repo rate keeps trending downwards, borrowers can expect a downward revision of their MCLR-linked loans.
'I suspect the recovery that the banks are going to get out of this IBC is not going to be more than 30 per cent.' 'If you leave the steel industry aside, the recovery rates are not looking very, very healthy,' Jairam Ramesh tells the Rajya Sabha.
He is talking, making sense, and India is listening. Rahul Gandhi needs to listen to him, too, says Shekhar Gupta.
If the new governor can think out of the box even as he signals that he can bat for the RBI cadre and respect its institutional memory, that will go a long way in getting out of the current impasse.
'The autonomy of essential institutions is clearly under question as the Modi government seeks to influence them politically.' 'The credibility of institutions such as the EC, the CBI, the CVC, the UPSC, the RBI, media, and universities, has been compromised,' notes Zoya Hasan, the distinguished political thinker.
'The Jalan Committee has now provided very clear guidelines on how the (RBI's) balance sheet should be looked at, what kind of disclosures should be made, what are the principles on which the Contingency Risk Buffer should be maintained, what should be the revaluation reserves, and the market risk to the Contingency Risk Buffer.'
RBI Governor Raghuram Rajan on Tuesday kept the repo rate unchanged 6.50 per cent.
The final and most significant reset in the relations between the government and the RBI is the manner in which the process of appointing the governor and deputy governors of the central bank has been changed.
A two-year extension at the helm of the RBI still looks a real possibility
'Modi remains the most popular politician in India; the BJP's organisational and fundraising prowess is considerable; and the Opposition, while newly collaborative, has no leader or clear economic messaging as of yet.'
'A bit of foresight would have helped.' 'Isn't it common sense that this is sowing and wedding season?' 'The plan is indeed unquestionably revolutionary, but better preparedness could have avoided such teething troubles.'
The Indian economy was on an impressive growth path through the first decade of this century till it was brought to an abrupt halt by the policy inertia during UPA2 and the Modi government's inability to restore economic and financial momentum. Fascinating glimpses of what went wrong from Puja Mehra's must-read book The Lost Decade: How India's Growth Story Devolved Into Growth Without A Story.
'Poor home work, and a subsequent loss of nerve.' 'This sums up the Modi government's current travails, the stall in key sectors, fading momentum, irritability,' points out Shekhar Gupta.
Market breadth depicted gains with 1,476 advances over 1,403 declines on the BSE. 140 stocks remained unchanged.
You must remain invested in bank deposits, unless you are considering the idea of earning higher returns by moving to gilt or liquid funds, says Adhil Shetty, CEO, BankBazaar.com.
'The time has come to incorporate Indian sociology into economic policy.' 'The first step in that direction would be to listen to economists trained in India and not just the US and the UK, argues T C A Srinivasa-Raghavan.
The average bank customer does not know about the Customer Charter because it was designed - under Mr Rajan's regime - to be a lame duck initiative from the start: violating the charter has no consequences, points out, Debashis Basu.
Government looking at cushioning slowdown due to demonetisation with sops and higher outlay for micro, small and medium enterprises, agriculture, and affordable housing.
'The RBI risks becoming dangerously weakened, as successive governments and finance ministers have misunderstood its role'.
Only Rs 16,050 crore out of the Rs 15.44 lakh crore of the old high denomination notes have not returned.
Breaking his silence over the demonetisation issue, RBI Governor Urjit Patel on Sunday said the central bank is monitoring the situation on a daily basis and taking all necessary actions to "ease the genuine pain of citizens" with a clear intent to normalise the things as early as possible.
The banking sector in India is reeling under Rs 8 lakh crore of non performing assets (NPAs) or bad loans, of which PSU banks alone account for over Rs 6 lakh crore.
Hopefully, the grey world of central banking in a nation hit by demonetisation, will lighten up with some of his notes soon.
India's growth, he said, remains resilient with low inflation, fiscal prudence and low current account deficit, talking about robust structural reform measures.
To do so, the government will have to tackle a number of broad development challenges successfully, says Shankar Acharya
Monetary policy stance to depend on inflation data
If receipts from disinvestment, tax buoyancy and black money scheme offset shortfall in spectrum sale, higher expenditure due to pay commission's recommendations and capital expenditure, then the government would be able to meet the target of controlling fiscal deficit at 3.5 per cent of GDP this financial year.
Inflation targeting framework is now enshrined as a formal agreement by the government and the RBI; thus, it may seem that we are flogging a dead horse, says Soumya Kanti Ghosh.
The 30-share Sensex jumped 729 points to end at 28,076 and the 50-share Nifty soared 217 points to end at 8,494.
'Who would want to be the man nominally in charge of driving the economy when your boss orders you to swerve it into a ditch of unknown depth?'
'Demonetisation demonstrates that this government is simply too amateurish in terms of economic policy-making to properly address India's deep, deep problems,' argues Mihir S Sharma.
RBI on Monday conducted an unprecedented level of liquidity infusion to the tune of Rs 3.3 lakh crore, in which banks bid for as much as Rs 4.5 lakh crore. The central bank said it would conduct a liquidity infusion auction of Rs 1 lakh crore on Tuesday as well, to help banks tide over the liquidity crisis.
RBI could opt for a 'deep cut' after winning inflation war, say experts.
'...Unless we muck up our policies.' 'We have to become a modernised economy.' 'Our institutions should be stronger. And that is most important.' 'The rule of law should prevail and contracts should be enforced.' 'Above all, we have to recognise the importance of globalisation.' 'It is in our favour at this stage. We should grow and become globally competitive.'
'There is no difference between the earlier government and the present government.' 'They are all following the economic policy based on the Chicago School of thought.' 'This school of thought says the government should have very little role in governing the country and the majority of the work should be handed over to the private sector.' 'This has not succeeded in the US.' 'Yet, it is being tried here by people like Arvind Subramaniam, Arvind Panagariya, Urjit Patel and Raghuram Rajan.'
Congress demanded a judicial inquiry by a sitting high court judge.
The government's critics say that the Prime Minister failed to rein in vicious and unprecedented personal attacks on the central bank chief by the likes of Rajya Sabha MP Subramanian Swamy.
'It is like bombing a building with 200 people to kill 5 terrorists.'
Rajan, as expected, furthered his predecessors' agenda and continued with the same resolution to make India's financial system safer, and direct the economy towards further liberalisation
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