Welcome and encouraging Change in Monetary policy

 Welcome and Encouraging Change in RBI's Monetary policy stance

This refers to the Monetary policy announcement by the Governor RBI(9/10/24) based on the deliberations of the new MPC committee since set up very recently in its recently held meeting  meeting. While the RBI has changed its monetary policy stance from accommodative to neutral taking into consideration the benign inflationary conditions, improved consumption, investments and continued strong financial stability, the overall confidence level exhibited on inflation front seems to be hawkish in the background of uncertainties and risks lying ahead, notwithstanding the fact that growth of the economy and inflation are well poised as of now. However, it is noteworthy to observe that though RBI has decided to maintain the status quo keeping the policy rates unchanged, the consensus of  all the MPC committee members to such a decision is absent as one new member of the MPC seems to have desired a cut in policy rate. All said, the RBI's  stance in the present scenario of disturbed  neo- political conditions and uncertainties in the International and domestic economic scenario seems to be accommodative and highly supportive of the economy to move in its  fast track as envisaged and motivated by the Government. The change in approach from accommodative to neutral is welcome and encouraging.            

T V Gopalakrishnan

Inflation perception and Reality

  Low Inflation is the key to ensure fast, equitable economic development and welfare for all.

Control high Inflation,bring down the  cost of living and cost of  production, reduce the inequality and realize the dream of the nation to be the most advanced Economy by 2047. High Inflation Kills the economy, people’s enthusiasm to live by honest means, tarnishes the image of Policy makers and administrators of the Nation and shatters the dream of all aspiring to make India, the most advanced economy  of the world by 1947. Inflation in moderation not only helps economic growth but also enhances respect for values and ethics, happiness and brings in the desired welfare for all. This is evidenced in almost all advanced economies Viz, USA, Australia, Japan, China,New zealand, Canada etc. The analysis based on data is intentionally avoided here as the policy makers, administrators and the well off categories in the society  have the wealth of knowledge and information and they may definitely be aware of  the ground realities among the vast majority of the people and their standard of life.   

Inflation remains and continues to be the main enemy of the average prople the so called common man  in particular  as of today. They lose their sense of thinking, judgment, adjustment to sentiments, emotions and life surroundings and calculations without any end and finally to anything to survive peacefully, comfortably and happily. Happiness linked to their earnings and survival are only for a few. For the majority of the people, fighting inflation throughout life, makes living in misery and destined to destiny unfortunately man made mostly. High Inflation also is a challenge to all Policy makers,politicians, administrators,sociologists and all well wishers of welfare of the people anywhere and everywhere.Very high Inflation is perhaps welcomed only by tax evaders, black money holders, anti socialists and those bad elements  who believe and survive exploiting the society by any and all means taking full advantage of  complexity in taxes, laxity in governance and  playing with  sentiments of different faiths diligently. This number is insignificant but is poisonous to spoil the food.       

By theory,inflation means, too much money chasing too few goods but by practice in an inflationary condition,what happens is that too few goods chase very few lucky people who have all the money and  affordability and leave those who have no affordability at lurch. Very high inflation takes the very charm of Life. Smart politicians in power make merry by offering freebies at the cost of taxpayers and the establishments are compelled to tolerate all corrupt practices making the position of governance vulnerable. Unfortunately a large segment of the population who respect values and ethics is caught in between as they cannot afford high prices to chase the goods and indulge in malpractice to survive the very high inflationary conditions by sacrificing a lot and miss a decent and dignified life. Not only can they fight  high inflation but they cannot think of surviving THE HIGH COST OF LIVING  as food, shelter and clothing apart from health, travel, insurance, electricity, water, social life cost unimaginably prohibitive. Factors responsible for uncontrolled  creepiing inflation not susceptible to regulatory measures also cause to increase the money supply and velocity of circulation of money, Increase in currency circulation due to official money supply, black money,  official build up of  forex reserves, Inflows of foreign exchange both official and unofficial,digital payments and increased rate of circulation of money, corruption and corrupt practices all around, increase in real estate transactions and attendant black money, unaccounted and unnoticed illegal payments both in formal and informal economies in varieties of details not being captured apparently by any means anywhere.Neither the Government, nor the RBI can have a track of all these except some broad parameters in the absence of meaningful governance and data collection,data analysis and enlighened public and sensivity of all concerned with administering the economy. India’s forex reserves almost doubled from $382 billion in June 2017 to $704billion in September 2024 a performance par excellence by any reckoning, but has brought with it the inflation pressures is also a fact which cannot be ignored while fixing the inflation target.         

The food inflation which fortunately gets the better attention of the authorities though remains unbearably high  for average people, also seems to be not properly assessed to the shocking surprise of the people as the official claims on inflation control do not seem to be reflective of ground level realities. Unethical pricing,under the guise of inflationary trends and smartness of traders and vendors to exploit mercilessly to make fast bugs also add to the desperation of the people.Technically speaking, all unfair trade practices and very high prices should attract the provisions of the Consumer Protection Act, but the people left for themselves to survive cannot afford to waste money and time to fight unfair trade practices and  high inflation in Consumer Court.

The Goods and Services Tax came into effect in July 2017. The Government of India introduced the GST mainly to replace the multiple taxes and have a single tax system.The GST, which replaced several indirect taxes, is a comprehensive, destination-based and multi-stage tax that is levied on every value addition.In simple terms, the GST is an indirect tax that is levied on the supply of all goods and services. It is ONE tax that is applicable all over India. (As per the GST act) An invoice bill from a provision store indicates MRP,GST, CGST, SGST and IGST.For instance in a bill of Rs797 for total  8 items purchased on 2/10/24, total taxable value is indicated as Rs 740.15 and the taxes levied are indicated as 56.84,28.42,28.42 and 0.00 respectively towardsGST, CGST, SGST and IGST.This means for an essential provision of Rs 740.15, GST alone comes to Rs 56.84 which works out to 7.68%. This Rs 740.15 Is paid from the tax paid pension income. If this tax amount can be used for quality food by a common man, the health, happiness and emotional quotient can definitely improve, bringing benefit to the nation’s economy.  

The GST no doubt is  innovative for all its merits and is good and simple. But, in practice and realistically,  it seems to be highly inflationary in its implementatin and largely perceived as the Government's Smart Tax to augment resources free of hassles.Though the GST is in operation since 2017, it has turned out to be inflationary and the cost of production and the overall cost of living have increased considerably. The GST collection which amounted to Rs 95633 crores in Sept 2017 though increased to Rs 1.73 Lakh Crores in sep 2024 (almost doubled ) has perhaps benefited the Government to contain the overall deficit, the cascading effect of such an increase has to naturally reflect on the products and services impacting the ultimate consumers whose income levels cannot definitely have doubled and have to bear the brunt of GST.Thus the inflation on food and non food items and cost of Living have increased making the majority feel let down and the perception of the people that GST is inflationary in character is just and justifiable, calling for an in depth examination of the rates and rationalization of the rates to acceptable and convincing rates. Willy-nilly , the  GST instead of emerging as a benevolent, egalitarian, and equitable tax benefiting the people all around, has in reality turned out to be an inflationary,inequitable,cash rich resource and widely undesirable / unacceptable among the masses and consumers of very essential goods and services. Besides, as envisaged this tax has not removed many other taxes directly and indirectly levied although some taxes are said to have been subsumed in GST. AS the proof of  pudding is said to be in eating, the proof of all merits of GST is yet to be established with conviction and acceptability by the people and perhaps by the Authorities as well, as the Inflation since introduction of GST with high rates irrespective of mass Consumable goods alongside all other major taxes in vogue continues to be a big challenge despite very accommodative and sensible monetary policy and unheard of success seen in the digital transactions possibly eliminating a big chunk of currency notes at retail levels in particular notwithstanding the fact that the  Pandemic Covid19  has destabilised the measures though. 

The inconvenient truth in containing ground level inflation faced by people at lower and middle class is that the policy makers and the authorities conveniently forget at policy implementation that the fiscal policies and monetary policies have got a cascading effect on the prices of  mass consumption goods and they go beyond the capacity of many .The food inflation in particular has crossed all limits of tolerance of majority of the poor and a very large segment of the population at the lower end of the rung struggling to survive leave alone understanding the need to fortify the food, improve the health and enhance the quality of life.The result is visible in the poor health of the people without adequate nutritious food intake.GST with all its merits has only added fuel to fire and the quantum leap seen in Digital Transactions has only oiled the smooth flow of money and increased money circulation adding to not only inflation but also to the identification of black and white money. This is amply evidenced from the number of people filing Income 

Tax returns assessed at 8.18 crore out of 140 crores of people in the Assessment year 2023-24 till 31/12/23. This is claimed to be an improved status in the filing of returns. The ever widening inequality seen in the country remains an unexplained proof that tax compliance leaves ample scope for improvement. While demoralization of people takes place through high cost of living, the divinity is also seen side by side through motivation and very high sounding promises and initiatives coming from all around enhancing aspirations of the people but with limitations for achievements. A maximum of 20% of the population may perhaps be able to enjoy the fruits of economic development whereas 80% of the population have to depend on food security, subsidies, freebies and other support systems . 

          

Taxes devoid of inflationary impact are rare and other levies recognised and unrecognized at various points of services and sales also add to inflation which by all means seem to go unnoticed perhaps by policy makers and administrators who are associated with inflation control .The fact of the matter is that inflation estimated at 3.65% for August / september  and talked about by RBI as somewhat benign does not reflect the actual increase in prices of vegetables, fruits, staple food items like wheat, rice, bread, roti, grains and oils.Even the prices of salt and Mirchi are becoming prohibitive. The day to day expenditure on only essential food items  does not convince the people that inflation is under control and manageable.Increase in wages, salaries, or dearness allowances etc cannot be a compensation at all to meet the real inflation at the ground level. On the contrary it  also adds to inflation as the demand from a segment of the people increases for the available commodities. The average person  feels the pinch of inflation and swallows all make believe statements emanating from all around . It is time the authorities reach these people , understand inflation and arrive at policies.

 

Apart from food inflation, the overall inflation and  the Cost of living have multiplied by leaps and bounds which go camouflaged from policy issues but adversely and very severely affect the cycle of savings, investment, employment, production, Marketing , Storage , Distribution, Transportation and Consumption. While fiscal policies and monetary policies, if well coordinated and implemented successfully and sensitively to each other's merits and demerits, can to a great extent help contain the  overall cost of production and cost of living. The full  benefit to the public at large and the Economy in general and the Country in particular can be envisaged and made a reality only if the Legislative, Administrative and Judicial system work in very close tandem keeping the objective of making the economy most advanced by the year 2047. Time is short and the task is huge.Readiness is all that matters. 

Welfare for all can be made possible only if food inflation is in moderation, fortified food is ensured to all, right to affordable education is guaranteed for everyone, laws of the country are respected and enforced equally for all without fear or favor and complied with by all citizens, effective governance and accountability in the whole nation turn into a reality and the fruits of economic developments and achievemnts are distributed fairly equitably and the entire humanity feel proud of being counted in letter and spirit and become part and parcel of the nations’ success all around. Existence of poverty and unhappiness  among  a big chunk of the population and enjoyment of affluence by a very few cannot go well with an egalitarian society. Noble thoughts, noble words and Noble Actions need perfect coordination from all those who matter in developing the nation. It is very apt to quote here  Mahatma Gandhi, father of our nation, that “economic equality means that everybody should have enough for his needs.” High Inflation cannot deny the rights of the people  to lead a dignified and minimum standard life. Is it not time to relook into the food inflation and cost of living and relate them to various varieties of taxes by policy makers in a VERY COORDINATED manner and make life comfortable for all segments of the population, by understanding and rationalising all  taxes realise the  dream of being an advanced economy by 2047. LET US MAKE IT AS PEOPLES’ MOVEMENT AND SEE THAT THE NATION ACHIEVES IT COMFORTABLY AND ENTHUSIASTICALLY. 

                    

T V Gopalakrishnan 

Views are personal.                 

  ( This article is published in Money Life on 7/10/24)           

Bit of Horse sense,But a lot of Luck

 

Dear Sir,

Apropos your editorial Three New Horsemen of the MPCalypse(oct 4), the responsibility of the new MPC is huge to maintain the accommodative monetary policy itself so far pursued in the midst of neo political disturbances. leave alone changing the policy rates favoring economic growth though highly desirable. The benign inflation experienced these days seems to be tapering off in the changed political and economic scenario abroad and the domestic food inflation which continues to remain high and unbearable for the  majority of the masses can be a real challenge for the new MPC, RBI and the Government as well to tackle. The economic policy needs to be tuned afresh to suit the tunes of the emerging political scenario at international levels along with the domestic adverse scenario changing very fast due to high cost of living , less consumption, lower savings, and consequent adverse investments and things like that allowing the envisaged growth possibilities an unrealistic possibility.The need to have a very imaginative and pragmatic fiscal policy at this juncture to nullify the cascading effect of increase in prices of food items due to GST and other taxes is paramount, at the same time to make the monetary policy feasible  to tweak the  policy rates to attract savings and encourage investments keeping the cost of production at a reasonable level  simultaneously is a herculean task .Smartness of the new MPC will be judged the way it can diplomatically coordinate the Monetary policy and the Fiscal policy aiming at the impossible possibility of ensuring price stability and economic growth and save the people from the emotional and financial miseries of high inflation and high cost of living.

T V Gopalakrishnan

Bangalore.            

(Edited version of this letter appeared in ET dated 5/10/24)

Improve the image of Tourism through meaningful Governance.

  The Need to Improve the image of Tourism through Effective Governance is paramount.  

I would just like to narrate below my recent unpleasant and unforgettable experience at Salem and the avoidable irritations and problems that I had undergone due to the lackadaisical approach and indifferent attitude of the service providers in booking the hotel online. The callous attitude  and insensitive response to the Customer’s woes after taking the full money only smacks of total disregard for customers,  disrespect for the authorities and lack of  awareness of the importance, the  need and the  development of our Tourism Industry. Sorry to observe that Greed unfortunately blinds the Wisdom is what I experienced. Given a chance, Cheat seems to be a business model as per my personal experience.

Invasion of digital payments and  online transactions have become very handy for unscrupulous, dishonest businessmen and fraudsters. Myself and my wife recently attended a marriage at Salem and our sojourn in Salem assisted by GOIBIBO (for our stay) claiming to be serving 5 Million Customers turned out to be an adventure and Life Experience Par- excellence perhaps of learning a lesson of modern day dependence on Technology and how people can be taken for an easy ride to make easy money without understanding the value of money, the emotional, sentimental, psychological, physical ,mental, financial  agony the aged people undergo in the process unnoticed by the authorities. Luckily we didn't suffer severely except for the loss of a few Rupees and physical and mental strain in a new place and surroundings for some few hours. No learning is possible without suffering physically, financially and mentally.

I booked through online a room offered by GOIBIBO in WINDSOR Apartments, Iyyan Thirumalligai , Salem Municipal town DOOR NO ¼, paying the full amount as an advance.for our one day stay commencing at 12 noon 7th September to 12 noon on 8th September 2024. Salem being an industrial and tourist attractive Center thanks to Yercaud and its natural surroundings,I found the rate in a service apartment is reasonable though comparatively high as subsequently experienced by me in Salem. However, the entire expectation of spending a night in the room offered turned out to be a total disappointment, nightmare and disaster when we saw the apartment in a dilapidated condition and the room in a very pathetic, unliveable and horrible state. Without having a second thought we canceled the accommodation on the spot and sent an email to GOIBIBO as advised by the receptionist in the Windsor Apartment with the assurance that I would be fully refunded. My worry at that moment was not the refund but to have our Lunch being aged and diabetic patients and finding alternate accommodation taking into consideration our health issues. Being strangers to the City and urgency to have lunch at that point of time around 12.45 PM.as we had exhausted ourselves travelling by car covering a distance of 200kms. The fact is that we missed taking a photograph of the room allotted to us in that melee.Unfortunately, the missing photograph of the room and the toilet which became the inevitable and essence of the issue for not considering the refund of our money by IBIBO was a surprise to us. May God save the noble minds with their greedy thoughts and avaricious actions. Does not matter as I can very well  understand the thoughts of petty minds. “Given a chance, Cheat”.Jane Do attitude of Customers Provides escape route as the remedial  and follow up measures are not worth the recovery of loss incurred. Never Had I been informed that the amount was not refundable.      

The concept of online booking is very good, innovative  and definitely convenient to save time, carry out the needed transactions and free from many of the known and unknown hassles, provided the culture of ethics, values, honesty and reliability are guaranteed by dependable practices and high levels of morality and integrity of the highest order are maintained at all levels of Execution and Administration. Herein lies the problem as this mode of carrying out the transactions has become a source of easy money and no traceability for further follow up and remedial action for want of any dependable and accountable administrative and other systems and procedures. Unfortunately this concept of online transaction seems to be an EASY source of FRAUD by smart operators, business establishments, involving banks and exploiting the people including intelligent, smart, literate , illiterate, gullible taking advantage of laxity in governance, corruption, ignorance and easy go culture in vogue knowingly or unknowingly developed with the invasion of liberalisation of rules under the guise of ease of doing business and lack of accountability seen anywhere and everywhere.The free and upper hand enjoyed by these types of business establishments can turn out to be a disaster and can definitely damage the reputation of authorities all around. Fraudsters adhere to a different KYC norms ( though not desirable ) which our own commercial establishments like banks, internet and mobile service providers fail to adhere although it is a strict requirement by rule.

 

 My objective of bringing a brief note is that such frauds and cheating of innocent, gullible public of all ages ignoring the impressions such perpetrators of frauds, tricksters, liars and cheats can create /  cause unpardonable  damage to the State’s and Nation’s  economy, image, very high culture, heritage, and civilisation and Law enforcing Authorities’ reputation, which by all means is avoidable and needs to be nipped in the bud itself however, or whatever  may be the might or powerful the people behind such business ventures. In the above referred case that I badly  experienced, I strongly feel that  the whole issue could have been  well avoided /handled better had the GOIBIBO taken  a little effort and care to ensure that only standardised and reputed service apartments and hotel come in their approved list and they are amenable to the norms and conditions well prescribed by the laws of the nation and the enforcement  authorities.The amount if at all refunded (though chances are very remote), would rather be spent in the upkeep of the room on my behalf or given for some charities.The most important aspect that I would like to highlight is that the technology commissioned by the GOIBIBO is customer friendly perhaps only to cheat or perpetrate fraud and the customer service support and seeking feedback and all is only an eyewash as the feedback sought by them will not reach them or is designed not to reach them as they know that the complaints are genuine and and their intentions / greed are met/is satisfied. This is my experience .My worldly knowledge /wisdom and understanding perhaps make me believe  that thieves, robbers, fraudsters outsmart others and authorities.as well. Survival for intelligent,  innocent, and ignorant people is becoming rather difficult.

I maintain a view that Tourists should carry some good image and impression of the state and places of their visits, the hospitality, the law and order situations, and a feeling of comfort, confidence, safety and well being and urge them to think of more of such visits often.       

I would like to emphasize here that the Success of businesses associated with the tourism Industry depends on their ability to make Travel And STAY more pleasant, Comfortable , memorable , highly reliable and trustworthy service. The authorities and all Service providers should feel proud of the facilities and hospitality they provide to tourists coming from India and abroad with lots of expectations from a fast developing nation. GOIBIBO definitely is a miserable failure by any standard and May God save them from disaster.  One can only feel ashamed the way they have modelled their business from my personal experience.    

Sarve Jana Sukhino Bhavanthu.

May God BLESS  US All  ALWAYS  and  IN All WAYS.

T V G Krishnan,

Honourable PM's Clarion Call

  PM MODI’s Clarion Call 

      I PROMISE To FACILITATE, You Must Promise to Innovate 

      I PROMISE STABLE POLICY REGIME, You Must Promise Positive Disruption

      I PROMISE Reform, You Must Promise to Perform

      I PROMISE HIGH GROWTH, You Must Promise High Quality

AT the inaugural edition of The Economic Times World Leaders Forum, Honourable PM Narendra Modi said, India is a land of opportunities and in its prosperity lies the prosperity of the world. ( ET dated 1/09 /24).

  

These are all words of Wisdom Coming from Noble thoughts and expectations of actions from all those who matter in the development of the Nation Politically, Economically, Socially and Technologically to ensure universal welfare for all. The Country has all the potential in terms of human and natural resources and the need of the hour is to use these resources optimally to benefit nature and  humanity. After all life is a  mystery and temporal whereas nature is perennial, all powerful and  provider of  everything that is needed  to sustain life. No doubt, Religion and Science provide the wherewithal,  guidance and support system to make the life wonderful, worth living enjoying the nature and adding to the comforts , discipline and order and bringing in some challenges of quality in living through evolutionary processes, civilisation, culture,  education and strong  administration to  avail  of all  opportunities and at the same time devoid of negatives for want of equality of Justice in the system.  Political Stability is sine qua non for the nation to look forward to developing the economy and provide social justice. The right leadership and the right direction of the economy can eliminate all stumbling blocks if any in moving  the economy forward without,  however, allowing rising of any malpractices which is an easy possibility in any democratic set up with a poor economic  background.

People the major beneficiaries of economic development should turn out to be watchdogs to prevent spread of corrupt practices and emergence of wrong doings taking advantage of lapses of administration, weaknesses of judiciary, and accountability of political set up.Wealth of the nation is for all to enjoy , but the way wealth is  generated, distributed, and deployed for further growth matters a lot and herein lies the smartness of the leaders and efficacy of the Governance system. Inequality in the generation and distribution of wealth needs to be minimized by provision of equality of opportunities in all respects. The key area perhaps requiring all round attention is reduction of Cost of Living , through reduction of Cost of  Education,Cost of  Production, Distribution, Marketing,  Traveling and  diligent elimination of Corrupt Practices seen practically in all areas of day to day life particularly of average person. The need for a very simple,  equitable and acceptable  tax system for all segments of the population and the economy is perhaps the KEY to kickstart the economy and bring in all round achievements to realize the dream of an advanced nation in terms of economic performance and welfare for all .From the development angle, a review of construction of Inflation Index, influence of GST, fuel levies, black money , corrupt practices seen in and around all high end consumption areas having both imported and domestic inflation impact would make sense followed by prompt corrective action. The proof  of pudding is in eating and not in the ingredients.        

Inorder to derive the full benefits of intended reforms, the time has come for all well intended people to perform well in their respective field with devotion, commitment, sincerity , utmost loyalty and above all  with adherence to the very noble  message of Bhagavat gita that  we should do our best and serve the respective profession with perfection and without expecting any self gain or reward. Reward comes in the form of national prospirity and welfare for all to share and rejoice.

Every institution and every individual irrespective of their stature in the overall system should feel highly proud of their involvement and contribution to take the country forward utilising all their potential and resources and see that the efforts they put in bring in benefits in terms of joy, delight. happiness, satisfaction and self actualisation. There should be unity of thoughts and actions among the Constitutional Experts, Administrators, Agriculturists,  Educationists, Financiers,Industrialists,Journalists, Law Enforcing authorities, Legislators, Religious Leaders, Scientists, Social Reformers, Technocrats and all Well Wishers who relish welfare of all in letter and spirit. The Year 2047 is not that far off to realise the dream of the developed world with the Readiness of All Citizens  under the leadership of the honourable  PM MAN OF DEVELOPING INDIA.

Loka Samastha Sukhino Bhavanthu. Hope the whole nation accepts the  promises,  works,  achieves and fulfills the aspirations of all everywhere.      

T V G Krishnan

( Personal Views )

Congratulations to Times of India Team

 Hearty Congratulations to the Times of India Team for its edition of 15th August 2024  i.e. India's 78th independence day for bringing out the  Independence Day Special supplement as an Advertorial and promotional feature presentation under the Title Leaders of Change. It is  not only a very timely and imaginative presentation but also the most appropriate,  very motivative and provokingly excellent food for thought  to the people of the Great Nation to introspect, act and  realise the dream of being a developed nation by 2047. The topics covered inter- alia include broadly Politics, Economics, Social and Technological aspects and provide enough of ideas  to all intellectuals and leaders engaged and sincerely interested in the development of the nation and making it a powerful economy of the world ensuring welfare of the humanity in the whole Universe in terms of peace, prosperity and fulfilment in every sense. Such a well intended and highly objective journalism would definitely add values and enrich the people a lot. Keep going strong and let us all be really proud of our nations' highly potential  capabilities, resources and  achievements. May God bless us All Always and in All Ways. 

Loka Samastha Sukhino Bhavanthu. 

TVG Krishnan 

(personal Views)

Deposits the Bread and Butter of Banks and THE DEPOSITORS as well.

 

         

          Deposits the Bread and Butter of Banks and the Depositors as well.

This refers to the  news report ' FM tells lenders to bulk up Deposits (ET 11th Aug)' .The need to enhance the deposits of banks is sine qua non for not only for  banks but also for the economy to realise the dream of the PM to make the  economy fastest growing  and realise the dream of our PM  to take the nation forward and outsmart other advanced economies to reach on top of the world by 2047. Banks, the most powerful engine for the growth of the economy, need to mobilise the savings of the masses particularly the household savings  lying in different forms searching for better returns, safety and liquidity despite high inflation, dwindling deposit rates, varieties of taxes  and risks of loss of savings itself in speculative ventures.Even the RBI Governor has goaded the banks to find innovative ways to augment deposits and minimise the mismatch between the deposits growth and credit growth. The fact that both the FM and the RBI Governor have  echoed the  same views on the need  for banks to augment deposits by all means , it should make the policy makers to introspect deeply on  arriving at the fundamental causes that lead to erosion  in  deposits, household  financial savings , diversion to speculative savings to make a little extra and think of a fresh approach to have well coordinated  fiscal and monetary policy measures through a well thought out economic policy. While the  Fiscal policy of the Government  can definitely incentivise the savers and banks to augment the deposits through tax changes  , the monetary policy of the RBI can definitely influence the banks to have innovative ways to attract deposits and quality credit deployment . Added to these, better, meaningful, result oriented administrative initiatives in enhancing the quality of Customer Service intended and rendered by banks at the ground level can do wonders in augmenting the deposits by leaps and bounds.  As long as the real rate of interest earned remains 0 or negative because of inflation and high cost of living , the banks cannot expect to mobilise  household savings and public cannot be expected to provide any  emotional and economic support  to the Government for all its economic development. Ground realities at micro level need to be understood and factored into while making economic policies  by policy makers and administrators while implementing the policies.       

Though  the  Middle class remains the backbone of any nation and the banking system remains the backbone of the economy the approach and treatment meted out to  the middle class  need to be reexamined, reviewed and effectively  managed diplomatically, logically, politically, financially  and socially in letter and spirit. Hope some sensible and noble thoughts and actions would follow from the authorities for a change in outlook in policies aiming at the welfare of the masses all round and  betterment of the economy covering all segments of the economy and faster growth of the country. 

Loka Samastha Sukhino Bhavanthu. 

T V G Krishnan

(personal Views )