Account for the lapses in PSBs

The problem of NPAs continues to be underestimated without any serious thinking on disciplining the banks and the borrowers is what is highlighted in the editorial.The banks balance sheets are window dressed to such an extent that no one can really figure out what is the real strength of our banking system. Ever greening of NPAs is an established practice and restructuring of  bad loans is nothing but an official version of ever greening with the blessings of even RBI.The write off of loans resorted to and the addition of NPAs on a recurring basis has been unfortunately absorbed by the accretion of deposits and addition to capital subscription by the Government using tax payers money.Though the death knell of banks is already sounded with ever increasing of bad loans,the tendency to ignore the problem both by the Government and RBI as the depositors and other stake holders bear the brunt cannot go on for ever as public awareness is on the increase and they will start questioning openly and the authorities will be constrained to account for the lapses.

Dr.T.V.Gopalakrishnan

(This  appeared in  Business line dated 26/12/2014)

How long can we ignore the agricultural sector?

Agriculture continues to be a neglected sector is what the editorial highlights quoting the survey report of the National sample Survey Organization.Why it is so is what the Central Government, State Governments, RBI and NABARD should introspect and come out with a detailed report what went wrong and how the policies went wrong ? NABARD's role need to be reviewed as it does not appear to have played its role effectively as envisaged in the development of agriculture and rural sector.Given an opportunity agriculturists run away from this profession as the income generated from agriculture after undergoing all hassles and suffering is not adequate enough to sustain themselves in these days of high inflation, high input costs, nonavailability of laborers, high interest costs, inadequate and timely credit, inadequate insurance coverage and dependability on the monsoon,etc. All these issues have been under discussion for decades  and resources spent on conducting surveys , meetings seminars, conferences , setting up of institutions like RRBs, strengthening of Cooperatives, nationalization of banks, reorganization of Boards of banks,setting up of NABARD exclusively to develop agriculture have not yielded any worthwhile results only smacks of poor implementation of actions envisaged and lack of commitment and sincerity in solving the problems of farming Community who provide the food and comforts for all to survive and make merry.It is  a sad state of affairs and lot of expectations are there from the new Government under Mr Modi and a lot needs to be done perhaps from the scratch to provide relief to farmers and make agriculture one of the attractive professions and a dependable main pillar of this economy.    

Dr.T.V.Gopalakrishnan

(This comment is given in Business Standard dated 23rd December against the Editorial )

Non affordability and high prices affect the realty sector demand

The demand cannot be expected to pick up as there are no first time buyers because of non affordability and a big chunk of black money involved which the masses do not have and they have no avenues to make also. The demand is normally from those who have various means of incomes and are from well employed segments having access to liberal loans and sources of black money. Since of late the fear of tracking black money is in circulation, many avoid investing in houses. Besides, the return on investments is also unattractive and the prospects of getting out of the investments through sales are bleak. The taxation policies and the hassles involved in acquiring properties also discourage people from investment. The old theory of renting a house is more wise and finding more acceptance and practical these days. Fools invest in houses and wise people stay is becoming a reality once again.

Dr.T.V.Gopalakrishnan

(this comment appeared in Business line dated 23rd December against the article demand pick-up evades realty) 

Why hesitate to discipline the bad borrowers and the erring banks

Disciplining the borrowers and erring bankers who encourage and support knowingly defaulting borrowers is what has been emphasized with a practical suggestion to contain the formation of NPAS in banks and save the depositors , taxpayers and employees from the rotting banking system in the book Management of Non Performing advances published by the Indian Institute of Banking and Fiance way back in 2004. Had the suggestion been accepted and implemented, the economy and all its stakeholders particularly the Government would have benefited a lot and the issue of NPAs would not have been a threat. Vested interests somehow kept aside the suggestion and now through Dr Rajan some of the solutions indicated in the book find acceptance. Even now it is not too late as the suggestion given in the book in the form of statistical model if implemented with the aid of IT can be a permanent and reliable remedy to contain NPAs in banks. Dr.T.V.Gopalakrishnan (This comment has appeared in Business Line dated 23rd December against the article Reserve Bank comes down hard on evasive borrowers )

Greed . Inefficiency and Banks

Greed has overtaken the market and this reflects in the pricing of products and services. Charging for withdrawals through ATMs by banks adds one more component apart from greed ie pricing for their inefficiency in managing their portfolios particularly Advances and other assets like establishments. NPAs and expenditures to accommodate various obligations like the recent episode observed in the UCO bank to sponsor the Government projects at bank's cost are features commonly observed in almost all banks and they seldom get examined by any. Depositors are forced to bear the brunt and they have no means to fight the atrocities being committed by banks day in and day out. The depositors are paid a pittance of 4% on their SB balances and banks meet several expenditures unconnected with banks business to accommodate many. Auditors , regulators seldom examine the expenditures of banks and fix them for their irregularities. It is time depositors unite and fight for their genuine rights as banks are run with their funds and a run on banks is protected with the depositors' and tax payers' money. Charging for withdrawals through ATMs has no justification what so ever and it only shows banks' indifference and callousness to understand the depositors' plight and their own survival without depositors' support.  

Dr.T.V.Gopalakrishnan

Make PSUs contribute

The time is right for the Government to offer loss-making PSUs on lease to professionals from both domestic and international markets and make them contribute to the economy in a big way. Taxpayers’ money cannot be allowed to be drained through these white elephants and the investments made in the PSUs have to show returns in terms of employment, production, revenues and growth in GDP. The Government has the backing of the masses and it is committed to good governance and bringing in efficiency in the management of the economy.

TV Gopalakrishnan

(This letter appeared in BL dated 12/11/14).  

Food supply and Money supply are two different aspects

 Economic Growth also helps inflation to come down is simply ignored by the RBI. The rigidity with which the rate of interest is linked to inflation and that too CPI index is irrational (although highly desirable) and it is akin to chasing a mirage in the present economic scenario. Besides, RBI by sticking on its policy rates only to inflation fails to comply with its statutory requirements ( well spelt out in the preamble of the RBI Act, 1934) of ensuring growth with price stability. Why RBI does not want to  recognise that indian economy is way behind advanced economies to adhere to only inflation targeting through its monetary policy is a mystery .Indian economy has its own uniqueness wherein, the banks have social responsibilities , the government has a huge burden to lift the masses from poverty through various schemes injecting money, the economy itself has fundamental issues of fiscal deficit thanks to its heavy dependence on imports of certain essential items like oil, coal etc to run the industries, requiring heavy dose of bank finance . Besides, the presence of informal economy also upsets all the official moves to have a smooth run for the economy.  Unless RBI takes a holistic view of things which was all along the practice followed by it since its inception in 1935 and making the  banking sytem support the growth with provision of adequate credit at reasonable cost, the growth may not take place.  RBI's stance and support of the economy keeping   a sound and healthy banking system has been well acknowledged and well recognised all over the world.It has withstood all imaginable pressures with ease and dignity and supported the Government keeping its restricted autonomy in tact. The economy cannot be expected to do better  without money. As credit is the life blood of commerce and in India only the banking system can provide this vital element RBI has a key role in ensuring that the transmission off credit at reasonable cost is made availble at appropriate time.This has to be made known to RBI by veteran journalists through their write ups is something unfortunate.The article carries lot of message and still RBI wants to be adamant on its undiplomatic and dear monetary policy, its supermacy may be at risk.RBI has never failed and it  should not fail in its responsibilities to the nation and its masses.Economic Growth with price Stabilty can take care of both.Shortage of food supplies in the market cannot be tackled with containment of Money supply is what RBI has to realise and proceed.

Dr.T.V.Gopalakrishnan

(Modified version of this is published as comment in Times of India in response to an article by Prem Shankar Jha on 2oth Oct,2014). 

Find Solution

This refers to the editorial, “Taking cover” (October 15).The issue of unhedged exposure of corporates and others comes up every now and then without arriving at any tangible solution.

The RBI has been flagging this for years now, but corporates, particularly those having exports, gamble on this as they perhaps prefer to keep the forex exposure unhedged to take advantage of the rupee depreciation. Further, the accounting system in vogue does not insist on the need to make transparent the unhedged exposure and the attendant risks.

The major reason for many to avoid hedging may be due to lack of expert knowledge and guidance. As rightly suggested, the Government in consultation with SEBI and the RBI has to take concrete measures to take care of this and make it transparent in the published balance sheet. Banks also need to develop the required expertise to guide their customers in the matter.

TV Gopalakrishnan

(This letter appeared in Business Line dated 16/10/14),

RBI is becoming a non entity.

The way the Government wants to fix the inflation target by the Government, RBI will be a non entity after a few years. The proposed Monetary policy Committee will have some Government officials or some parliamentarians and Governor will only be a figurehead. With the implementation of other recommendations of the FSLRC, RBI's presence or absence in the economy will not make much of difference. Politicians will always have the Final word is what is being proved now.So far, the RBI Governors somehow withstood the pressures of the Govrnment and did not yield much. Even Dr Subbarao the former Governor had to fight a fierce battle to maintain RBI's autonomy and this stance has been getting a final go bye.

Dr.T.V.Gopalakrishnan

(This comment has been given in ET in response to a news report The Parliament will decide the Inflation Target for RBI that appeared on 8/10/2014).

Is RBI pragmatic in it's thinking?

 The measures announced by the RBI in its recent policy review are a clear indication that it is not convinced of the measures on the part of the government to contain food inflation and the inflation will continue to remain high till March 2016 without giving any scope for adjustment of policy rates. While the arguments put forward by the RBI sound academically reasonable and acceptable perhaps but how long it can ignore its other statutory responsibility of supporting the economic growth is an issue to be sorted out by the Government. Unfortunately the understanding between the Government and RBI which had historically,  had a mutually reinforcing influence in deciding the fiscal and monetary policies had been becoming the thing of the past does not augur well for the economy is what is to be understood both by the RBI and the Government. The other regulatory steps particularly the reduction of the HTM category of banks’ investments and bringing in Urban Cooperative banks under LAF are welcome to strengthen the market. However, the haste with which the RBI plans to issue licenses to have Payment and Small banks in the field is not very convincing taking into consideration the not so encouraging performance of Local Area banks, Regional Rural banks, some of the old generation small banks and cooperative banks unless RBI wants one more head ache to add on to its Financial Stability Issues. More Non Performing Banks are desirable along with ever increasing Non Performing Assets of banks is what RBI has to seriously consider.

T.V.Gopalakrishna    

No understanding between the RBI and the Govt

Well analysed and well presented. The approach of RBI targeting inflation control ignoring the growth aspect completely is at variance with the statury responsibilities entrusted in terms of the RBI act. The historical understanding between the RBI and the Government to have an economic policy consisting of Fiscal policy of the Government and monetary policy of the RBI with mutually reinforcing measures to ensure economic growth with price stability and monetary and financial stability seems to have been  gradually given a go bye and both the government and RBi are moving on different directions the way both function. RBI's intentions to control inflation and having an inflation target are appreciable, but the measures taken by it alone without any understanding with the Government and without having an ideal economic environment will not lead to anywhere is what needs to be realised. From this angle,the article raises some valid observations and RBI will have to make it clear to the market the basis for its present approach ignoring the statutory provisions and keeping the inflation targeting which has only limited bearing of the monetary policy in reality.

Dr.T.V.Gopalakrishnan

(this comment is in response to an Article RBI in search of a theory that appeared in The Mint dated 30/9/14).

The need to have better behaviour of public in public places

Very well written editorial. Indians have literacy, education , money and many have good exposure to  modern living standards, decency, decorum to  be maintained in public places etc, but the way they behave and conduct themselves in public places leaves much to be desired. One can easily make out Indian crowd in any International Airports, Restauranrants, public places like zoo, museum or cricket or football grounds from their conduct, behaviour and discipline. Unfortunately there is a tendency to outsmart the others whether required or not when they are in a queue in a cenema hall, restaurantor railway counters etc.The tendency to vioalate the rules is a thrill and they never miss any opportunity. In roads, they are not seeing the traffic signals but they are seeing whether there is a policeman. If Police man is there, they by and large observe the traffic signals but the moment policeman is off, violations are  very common and they become the rule rather than an exception. Even in malls, they have no patience to stand in the queue to pay their bills and one can see lot of quarrels on this issue. Those who care a little to follow the rules and try to behave decently turn out to be fools, suffer and get frustrated. The latest incident in the Zoo is really unfortunate and the behavious of the masses in Indian Zoo is very pathetic as animals are being tortured by throwing stones, bottles and whhat not. Recently, I happened to vist a zoo in Texas, USA, and it was a pleasure to watch the crowd and their behaviour than the animals and the birds in the zoo. One always feels sorry when one recalls the experiences in our Zoos in india. Time our curriculum in schools and colleges includes some special lessons on public behaviour,etiqutte and manners. Authorities manning the services also need a thorough exposure to maintain highest levels of safety and comfort standards for public.  

Dr.T.V.Gopalakrishnan 

(This comment is given in BS in response to the editorial appeared on 27/914).  

Peace for the entire humanity in the whole Universe.

Peace for the entire humanity in the nook and corner of the whole unisverse
 is what the United Nations Should cherish in the 21st Century. Violence, terrorism,
 poverty in any part of the universe will not augur well for human welfare, their safe and 
peaceful living. Civilization is all about allowing humanity to survive well and ensuring
 good to win over any bad and evil spirit . Only Good thoughts words and deeds
 should prevail everywhere. The UN should aim for Universal peace taking Humanity
 as the sole Religion.The Human Race Can and should be able to achieve Universal
 Peace and welfare for all.That is the beauty of life for all to enjoy and experience.

Dr.T.V.Gopalakrishnan.

Man On Developing India MODI.

Man On Developing India ie MODI.The whole Country is in a charged atmosphere and positive energies are found every where.People look forwrd to experience / hear  something good happening everyday on the economy and he never disappoints them. He has brought the confidence back and with his frequent  and continuous interactions with the leaders of the world, definitely the economy can be back on the trajectory of fast growth sooner than later.Mr Modi has modified the ways of functioning of the bureaucracy and the results have started trickling in in all segments. people are gradually forgetting last decade of Inaction and a new chapter has begun with lot of hopes, aspirations, actions and activities.

Dr.T.V.Gopalakrishnan.

(This comment is given in response to an Article Mod Mod Modi in BS dated 26.9/14)

Discipline the banks and borrowers through transparency.

No doubt transparency in respect of large borrowal accounts in particular will prove to be a remedy in making them performing assets in banks books. When large projects get cleared and loans are sanctined the terms  andd conditions of sanction, how the projects got cleared, whether they are socially desirable, technologically feasible, economically viable and financially sound need to be made transparent. The men behind the projects,their competence, their track record and thier involvement and commitment in terms of Financial Contribution etc should be made known. The creativity if any in accounting practices generally resorted to by large Companies in manipulating and inflating the Contribution by the promoters needs to be highlighted and nipped in the bud itself.The details should be highlighted when such companies go for an IPO and raise capital. The SEBI also has to play a crucial role in disciplining the borrowers. The way the borrowers conduct the bank accounts needs to be independently verified by the SEBI and certified in their Balance sheets. Banks rating and banks qualification of the accounts if any need to be made transparent in the Balance sheets of Companies. The need to bring down NPAs in banks books and disciplining the borrowers and banks to ensure a sound and healthy banking is very crucial and the transparency of the details can definitely improve the performance of both banks and borrowers. Any mischiefs played by any Board Members of both banks and borrowers can also be minimised through the process of transparency. This article isa pointer to that effect.   

Dr T.V.Gopalakrishnan

(This comment is in response to an Article Transparency can be a cure that appeared in Business Standard dated 22/9/14)

Governor has done Credit to RBI

The editorial is well balanced. Rajan has done credit to RBI by sticking on to  the dearer Monetary poloicy despite the expectations and pressures from market to soft pedal because of the change in the Government and improved confidence in the Governance Standards for a performing economy. His stance on interest rates and forex policies has really earned him the kudos as inflation has started showing declining trend and the Rupee has somewhat stabilised, though both are not as comfortable as one desires.All said, the governor has erred on maintaining banking stability and the proposal to issue licenses for small  and payment banks which can further destabilise the banking. NPAs are due to non performance of RBI and Banks Managements is a fact which cannot be easily brushed aside.Though the Government interference  in banks' functioning may be a cause for enhanced NPAs but still the RBI could have taken strong measures to discipline the Banks' Boards and bad borrowers. Besides the approach to restructure the RBI chosen by him is not on desirable lines in the background of its losing functional autonomy and fast declining operations and staff resources.

Dr.T.V.Gopalakrishnan

(This comment is given in response to the editorial in Business standard,)

Maximum Government and Minimum Governance

The Governance in PSBs  and in the Regulator is maximum by the Government and the result is visible in the functioning of the PSBs and RBI as well. The Reserve Bank has lost its regulatory autonomy and the interference of the Government on the functioning of RBI and Banks has led to the weakening of banks and dominance of Directors appointed by the Government in the sanctioning of loans and isssue of Directives by the Government Instead of by the RBI to banks. It is  also wrong to assume that all is well in private sector banks and everything is wrong in PSBs. The window dressing of Balance sheets and Profit and loss accounts is there in both the PSBs and Private sector banks but unfortunately the borrowers have more freedom to hoodwink the PSBs and get away easily which is somewhat difficult in Private sector banks as there are no Directors on their Board  either from the Government or RBI. Further the so called new generation  Private sector banks have some built in advantages of high tech, free of certain directives compelling them to lend to Prioirity sector, Financial Inclusion and opening of branches in unbanked and non profitable areas in as much as they are applicable to PSBs and above all they are acountable to shareholders.The pattern of lending resorted  to by PSBs and Private Sector Banks also differs and the clientele they have particularly new generation private sector banks are mostly high tech and they are also not concerned with various charges they are subjected to.The level playing field varies a lot and PSBs are always at a disadvantage.Instead of Maximum Governance other than by the Government, there is no Governance both in PSBs and RBI due to Governments' interference particularly in relation to regulation of banks  is a reality and this has to be accepted. Even the transmission of Monetary policy has not been as effective as it was in the olden days because of the interference of the Government in various ways.

Dr.T.V.Gopalakrishnan

(This comment is given in BS against an article Minimum Govenment and maximum Governance that appeared on 27/8/14). 

Is it not time for Depositors to unite and fight against exploitation?

Banking is becoming a mess and the way things are moving depositors would be asked to pay a fee for depositing the money. The use of technology is to save cost of transactions and ATMs have facilitated to save a lot of cost in terms of maintaining branches and staff at a high cost.SB account holders get a pittance of 4% for their balances and on that they have to pay taxes also if the interest exceed Rs 10000. Banks can manage to accommodate lakhs of Crores of NPAs and write off of loans again at the Cost of depositors as there is absolutely no resistance from them. Charging for ATM withdrawal is nothing but a planned loot and RBI should not be party to this.Time depositors unite and fight for their rights. It is unfortunate that banks and bad borrowers are thriving exploiting the depositors by all possible means and it is the best opportune moment for Money Life to organise Depositors and fight for their justifiable rights.

Dr.T.V.Gopalakrishnan

(This comment is published in Money Life dated 25/8/14 against an article is  the restriction on the free use of ATM  fair ?)

Comments on the Decommisioning of Planning Commission.

The move to remove planning Commission is excellent. This needs to be replaced with a suitable body  which can take care of the Regional Imbalances and equitable development of various states particularly underdeveloped states seeking active coopration of developed states. The new body should have experts from Agriculture, Planning, Industry, taxation,rural development, Information technology and data collection. It should have representation from all regions. The village surveys which were once prominent and helped to devise developmental plans have been unfortunately given a go bye and it needs to be reintroduced involving NABARD and Regional Offices of the Reserve Banks.  Local Boards of RBI need to be involved actively by the new body The strength and weaknesses of each and every state should be studied in depth and efforts have to be identified and activated to exploit the potential to the optimum. Infrastructure needs like Roads, Cold storage facilities, transports at reasonable costs need to be built without any leakage of money through corrupt practices. Social audits should be made compulsory whereever public spending is involved. A lot can be done by the new organisation and care should be taken to see that it does not become another white elephant.

Dr.T.V.Gopalakrishnan

Forex Reserves

Forex Reserves no doubt have been on the increase and are at somewhat comfortable leve, but the fact that the external debt is in excess of these Reserves cannot be ignored. The share of short term debt is also on the increase needs to be factored into. The best way to enhance the Forex Reserves is to increase the exports considerably particularly high value items through enhanced industrial production and project exports. The import of non essential items needs to be curtailed and imports substitutes should get encouragement through meticulous planning and execution. While inflows need to be given a boost, the outflows call for caution through persuation and moralsuation as liberalisation  should not lead to misuse. Management of reserves deserves continuous monitoring and skilled deployment to attract returns and further flows.

Dr.T.V..Gopalakrishnan

(this comment is given against the Editorial in BL on More Cover needed  dated 9/8/14)

The Technology that Banks use can land you in trouble - Money Life

How risk-free banking process promised by technology-driven banks can create problems for you

My experience with one of the largest private banks, among the more aggressive ones that came up in the 1990s, speaks a lot about how technology can be a bane instead of a boon. I left for a trip to the US and before leaving I called on the branch official to draw some foreign exchange, as also to ensure that in case I may need it, I should be able to execute my banking transactions through internet banking, which is relatively secure and hassle free. I also made a request in the prescribed format to ensure that the One Time Password (OTP), essential for internet banking, be forwarded to my e-mail account in addition to being sent to the registered mobile number. Further as a matter of abundant precaution, I requested the official to help me on my request in case any need arises as high tech banking permits, encourages and welcomes e-mail contacts and correspondence to avoid personal interactions.

As a back-up and to avoid the title of a defaulter of credit card dues, I cleared all my credit card dues till the day of my departure as per the banks’ statement. But the happiness of hassle-free banking was short-lived and I now find that I have become a defaulter for non-payment of an insurance premium to one of the group's associate companies, as well as a tax defaulter for not filing Income Tax returns by 31st July!

The mistake I made was that I did not carry my debit card and did not sign up for the international roaming facility on my mobile phone, as these requirements were not made known to me by the branch officials. All thanks to the risk-free banking process promised by technology-driven banks.

ICICI Bank, one of the largest in India, has a system to register complaints and feedback at various levels, through internet banking, by email and personally with the relationship manager designated for all privileged customers. However, when one contacts them, the system only ensures that the customer gets standardised replies with regret couched in very polite language.

The bank responded quickly, saying that, ‘We regret that currently we do not have the process to send One Time Password (OTP) for resident customers on e-mail. For resident customers, the OTP is sent on the registered mobile number. Alternatively, we wish to inform you that you may call our 24-hour Customer Care, post authentication, they will be able to confirm to you the OTP generated for your transactions’.

The customer cannot have any complaints about the behaviour and tone (which is very polite), but definitely cannot expect any favourable response for his or her grievances. This is to be expected as machines take care of the grievances and human beings have a limited role in delivery and redress of complaints.

I have been in constant and long-winded correspondence with the Bank, since May 2014, about my inability to access to my internet banking account, and inability to transact in the account for want of the so called OTP. The bank neither bothered to understand the problem in totality, nor did it care to arrive at a workable solution. The issue of the OTP, even though cumbersome, could still be resolved and I had a small share in the blame, but without one’s debit card, the technology would not allow any transaction through internet banking and the bank has no solution or process to take care of this.

What is more shocking is that either the Bank's branch level personnel are either unaware or do not care to inform the customer, that it is essential to carry their debit card and registered mobile (obviously on international roaming) while going abroad.
All this, thanks to the risk-free banking processes offered by banks, without knowing banking in the real sense of the term and without considering a customer's needs.

Meanwhile, I came across a news report in Business Standard that the Bank has plans to introduce/ improve their services to non-resident Indian (NRI) customers.

I think it would be better for the Bank to improve its services for domestic customers first, before it attempts to introduce/ improve its services to customers outside the country. The bank has a system to receive complaints and feedback, and these can be registered at various levels, but the fact remains that the replies are standardised from all levels and the complainants receive the same stereotyped replies.

Knowledge of banking is alien to its operational level staff and the human touch and interaction cannot be expected of them. These were virtues of banking in the 1990s and earlier periods. The present staff are expected to know and refer only to some standard checklist fed into the computer. Know your customer (KYC) norms and technology have also become more of a handicap than a help for customers when it comes to switching banks. When the domestic customers undergo harassment and harrowing experiences without any possibility of getting relief, one cannot even imagine the sort of suffering the NRI customers would undergo. The top management's intentions are most likely good and laudable, but the fact remains that their intentions seldom percolate to the operational level and the ground realities are completely different and unpleasant.

Banks need to provide services based on customer needs and adopt processes built more on common sense, knowledge and human interaction wherever needed. KYC and technology are to be used only, at the most, as facilitators.

Dr.T.V.Gopalakrishnan
(This article appeared in Money Life dated 1/8/2014).

Surprises and shocks

The article is very interesting and gives an analysis of events in a  unique way.Life is full of surprises for all particularly Indians. They got UPA into power twice in 2004 and 2009,but they got only scams and unmanageable price increases all around. It was both a surprise and a shock.They elcted BJP for the total surprise of all Congressmen and their leaders. Now people are wondering whether some Change would happen in the economy  or not . Expectations were at the peak when Mr Modi took charge of the country on May 26th and now two months are over and what would happen to the economy is still a mystery.Budget has not only surprsed but added to the confusion. Nobody including veteran economists are able to say in very clear terms whether budget is growth oriented or people oriented. or both. A bit confusion is there on that count. Nature has its own surprises.Earlier prediction was that it would be a failure but now it rains cats and dogs throught out the country as per some reports.Russia and Israel have created chaos, shocks and surprises the world over. Life goes on with lot of optimism,surprises and hopes.

Dr.T.V.Gopalakrishnan

(This comment is given in response to an   article by T C A Srinivasa-Raghavan: Bau saras, Mr Modi that appeared in BS dated 2/8/14).

   

Time for RBI to be soft

The fact that both Government and RBI are really seized of the concern of inflation and steps initiated by them have started yielding some positive signs on inflation and inflation expectations, cannot be ignored by the RBI while deciding the monetary policy at this crucial stage when the efforts of the Government to give a boost to the confidence level in the economy are catching on well and needing solid support from monetary policy angle. Further, the monsoon seems to be favourable and other trends which can cause inflation except perhaps the price of oil are moving in favourable direction. Industrial production has been picking up well and agricultural activities have been going strong all over the country with improved monsoon. This is the ideal opportune moment for RBI to give a signal that RBI favours soft rates to keep the growth momentum shown in industry and elsewhere. Inflation is definitely not because of monetary policy is a known fact and RBI can definitely be bold in reducing the policy rates. 

Dr.T.V.Gopalakrishnan

Human development Index Make it known to all those who matter

The analysis is very informative to the general public and should be educative to the Government . A lot needs to be done by the Government and the bureaucracy to see that the Human Development Index of India needs a drastic change for the better in several areas. The ranking of 135 out of 187 countries cannnot be impressive taking into account the country's rich natural and human resources and the potential available to  do better. This assessment needs to be taken as an evaluation of the performance of the Government and based on this there is ample scope for improvement in the area of poverty, equality, education,health and environment. These are crucial areas affecting the less fortunate in the society and there is a moral obligation on the part of better off section of the society to take care of those who are getting left behind. All important Institutions, corporates and all those who matter in the economy's growth should be compelled to read such analysis and do their bit to improve the Index.This is Country's prestige.

Dr.T.V.Gopalakrishnan

(This comment is given in Business Standard aginst the aricle above average that appeared on 27/7/14).

Is it Finacial Inclusion or Exclusion?

With all compulsions and incentives banks have failed to make Financial Inclusion a reality is the real story and how the DY Governor knowing fully well the mindset of banks' human resources expect that given freedom for banks they will perform well.Right from the days of Nationalisation of banks,both the Government and RBI are after banks to bring the poorer sections and less fortunate segment of the society under banking fold though it was all done not in the name of Financial Inclusion. Under Garibi Hatao programme of the Government, several schemes were brought into being and the fact remains that nothing has clicked. Twenty Point Programme, DRI scheme, loans to weaker secions, NGOs, priority sector advances including housing loan for weaker sections were all attempts to make Financial Inclusion and they have all been a failure or not taken off well to the desired extent.The approach should be different and Financial inclusion should be attempted through various institutions including educational institutions, malls, health centres etc and compelling their staff to enroll as many people as possible in banks. All households can also be forced to ensure that from whom soever they take some service should be having bank account. The banks should be given separate timing and a separate set of staff with a social bent of mind to open the accounts. The people should be attracted to banks and banks should be willing to receive them heartily and happily. I think the approach of the DY Governor does not sound convincing and banks will only take advantage of that. The results can be seen in six months time.   

Dr.T.V.Gopalakrishnan 

(This is in response to a news report appeared in Business standard dated 24/7/14)

Dr Subbarao a real hero and a role model

Dr Subbarao is one of the best Governors RBI  has had in the recent history and that too during its worst turbulent time in terms of the economic and polical conditions the country was facing.He came to RBI when the world was facing the global financial crisis and left the RBI when the world had not come out of the crisis and uncertainities of the economic recovery were  very much prevalent.He had to work under two veteran FMs who unforunately turned hostile towards him for their political gains ignoring the merits and professionalism RBI had demonstarted and practised in not only maintaining the Country's economy safe  but also enhancing the prestige of the RBI as a saviour of the economy by ensuring  for it the strong and very vitally needed support of the  stable and sound financial system in general and banking system in particular. He waged a lone battle  during his entire period of five years in fighting inflation mindlessly created by the Government with all its wrong economic and administrative policies despite repeated warnings and strong signals from RBI. He deserved special kudos for his conviction and fight with limited success for RBI's autonomy. He has proved himself a man of great wisdom and by his present approach to decline fabulous job offers he wants to demonstrate that the duties of a public sevant end on attainment of retirement and service to socity starts with the wisdom and experience one acquired as a public Servant. He does not want to be compensated for his past designations is a great thinking and carries a lot of message to many who run after assignments at the cost of self dignity for a few rupees more.

Dr.T.V.Gopalakrishnan 

Improve service first to domestic customers.

It is better for the bank to improve its services first to domestic customers before it attempts to introduce/improve its services to customers outside the country. Charity begins at home is what the bank should understand at this stage. The bank's service record cannot be said to be that good seeing the number of complaints received by the Banking Ombudsman. The bank has a set up to receive complaints and feed back and the complaints can be registered at various levels, but the fact remains that the replies are standardised from all levels and the complainants receive the same stereotyped replies mostly regretting their inability to provide the service the customers require. It is always the turn of the Customer to provide the service to banks ie avoid as far as possible to make any demands. Manage with what they have to offer. Knowledge of banking  is alien to operational level staff and human touch and interaction are not expected of them and they were  all virtues of banking in the  1990s and earlier periods. The present set of staff are expected to know  and refer only to  some standard checklist fed in the  computer. Common sense and application of mind  are limited to the capability of the Computers  and human beings are not expected  to  depend or use  them in the discharge of their day to day duties. It is for the Customers to appreciate all these and adjust themselves for what they get. KYC and Technology also  become more of a handicap than a help for customers to switch banks. Old generation banks under certain compulsions do care old generation people where as new generation banks have been enjoying the unwritten freedom to ignore old generation people.  When the domestic customers undergo harassing and harrowing experiences without any way of getting relief, one cannot imagine what sort of suffering the NRI Customers would undergo. The very top management's intentions are good and laudable, but the fact remains that they seldom percolate down  and the ground realities are something different and unpleasant.

Dr.T.V.Gopalakrishnan

(A modified version of this comment has been published in Business Standard in Response to a report  ICICI Bank introduces convenient banking service for Indians migrating to Canada appeared on the 16th July 2014.)

Active middlemen and inactive institutions

Middlemen remain active and  continue to exploit the situation of price rise creating artificial shortage of food stocks and supply constraints,  is known to the authorities and consumers as well for decades and why it is so is what is to be examined? The APMC act has outlived its purpose decades back and it should have been repealed long back. The authorities, money lenders, policemen, transport operators, bankers etc  are all hand in glove with each other and corruption and black money rules the roost.The producers have no say in the matter and their weak financial position is exploited. The banks have no concern and they  do not lend money when the farmers are badly in need of money.The farmers particularly small producers have no facilities to store the goods safely, are not able to transport at reasonable cost, do not get adequate insurance and time to safeguard their interests and there is no support from any worth  while  institution to protect the farmers interests. NABARD which can be the best coordinating agency and problem solver  has miserably failed in taking care of farmers interests, There is a Local Board in  RBI which can play an effective and proactive role in coordinating and guiding all local authorities in various states and banks including NABARD has not been taking  any interests although they can be easily an effective and very useful tool .There is no serious way of finding any solution to contain the food supply constraints and price levels.  Every one wants to talk goodie goodie and enjoy all perks and facilities delivering nothing. A lot can be and needs to be done but who bothers?Producers suffer and consumers pay for everything and suffer perennially.

Dr.T.V.Gopalakrishnan   

Econo-Reflexions: Is there any professionalism in Banks Boards?

Econo-Reflexions: Is there any professionalism in Banks Boards?: Banks' Boards are the major NPAs is not a great news. If Board Members  discuss taxi fare reimbursement more than the recoveries of ...

Econo-Reflexions: Total inaction by authorities cause NPAs in PSBs...

Econo-Reflexions: Total inaction by authorities cause NPAs in PSBs...: The discussions on NPAs have been going on for decades and the fact remains that neither the Government nor the rgulators, nor the banks b...

A House per family

The basis on which stamp duty has to be paid sshould be uniform through out the Country. Every family is entitled for a house and the concessions and reliefs should be extended only on one house per family. The second house should be discouraged and no tax concessions and relifs should be extended. The tendency to make real estate market as capital market should be nipped in the bud itself.This requires an excellent data base and the Government should be able to tie up the acquistion of house with PAN number, Aadhar Card and bank account etc through IT.

Dr.T.V.Gopalakrishnan

Is Ache Din possible and within reach?

Inflation needs to be contained through a combination of fiscal monetary and administrative measures. This requires cordinated efforts on the part of Cetral , States amd the Reserve Bank of India. without any reservations among themselves. The three deficits food, fertiliser and fuel which cause the fiscal deficit need a very sensitive handling in such a way that the rich and undeserving  people do not stand to be subsidised by the Governement. The taxes which have an inflationary impact need to be pruned down considerably and this is an exercise by itself as the loss of revenue has to be made up through other measures. The taxes like STT, income tax, educational cess, luxury tax on high end vehicles, dividend tax on dividends above a cut off limit, foreign travel tax whicr are not inflationary in character can be hiked and some more such taxes need to be identified to augment revenues.Along with these, apt monetary measures coupled with strong administrative measures capable of containing corruption, hoarding,facilitating storage,transportation and distribution  of food items without wastages at any stage can bring down inflation. Anything is possible and ache din is within reach,provided the mindset is attuned towards the target  with close monitoring and follow up.The ensuing budget is an excellent tool and it is a chance for the new Government to show its mettle to meet the aspirations of the people to have  ache din ahead.

Dr.T.V.Gopalakrishnan   

Is it essential to have an OSD in RBI?

The appointment of an Officer on Special Duty in the rank of Dy Governor from the private sector bank in the guise of streamlining the functioning of the Central Bank and rid it of the reputation being a monolith seems not desirable and that too in an autonomous august institution exclusively owned by the Central Government circumventing the provisions of the RBI Act 1934 is uncalled for and definitely not in the interests of the economy, the institution and its human resources. It not only takes away all the positives of the public sector character of a mighty and a nationally sensitive organisation but also weakens the regulatory system meticulously built up over a period for ensuring sound and healthy financial system in general and banking system in particular.

Dr.T,V.Gopalakrishnan

Encourage savings

Reduce the tax rates and take away all exemptions.People will save as savings are in their own interest. The Government need household savings for capital formation and for this the Government has to facilitate savings.This is possible by controlling inflation, running the banks efficiently and profitably, discouraging investment in gold and real esates, developing a healthy and strng capital market with maximum retail participation, reducing corruption in the society and avoiding generation of black money.  All these are possible if the Government is strong, administration is efficient, accountability is fixed, transparency is maintained,information is gathered adequately and put into optimum use to draw appropriate policies etc. The present vicious circle of lower savings, lower investment, lower production,high inflation, needs to be broken.

Dr.T.V.Gopalakrishnan

(This comment is given in BS).

Keep Dhanalaxmi Bank in ICU and Monitor Closely.

The problems seen in Dhanalaxmi Bank is man made and made by the former Chairman Mr Chaturvedi.He has made a mess of it and the present incumbent has no magic wands to undo what ever damages Mr Chaturvedi has done. He went for a massive expansion of branches adding along with it additional human resources and loans using depositors' money. He has failed to do the balancing of various activities and he has gone unquestioned by the Board of Directors and the RBI. This is comparatively a small bank with a sound deposit base and a large number of clintele with all loyalty and continued relationship. All the parameters have gone from bad to worse to say the least; the establishment cost has gone beyond any control and the NPAs have grown  perhaps with the full knowledge of the Board and the then Chairman. The bank needs to be kept in ICU with intensive monitoring by some stalwarts both in the Board and Top management. The timing is ideal now to set right as the economy has started picking up and there is improvement in the confidence level all around. The bank has a strong base and it can turn the corner comfortably. The HR needs motivation and made to perform. RBI has to ensure that the bank gets proper guidance and support to perform.  

Dr.T.V.Gopalakrishnan
(This comment is in response to an Article on Dhanalxmi Bank that appeared  in BS).

Why to mix Oil and Water

A well analysed presentation. Oil and Water never mix and better to avoid any temptation to mix. Water is purely a domestic problem and oil is an international issue.  However, both water and oil can unfortunately  add miseries to our economy  particularly in combating the already  persisting high inflation. Monsoon failure can affect the agricultural production and food supplies and fuel the inflation but this calls for an exceptional solution by way of effective administrative meaures coupled with prudent management of the imports of esssential food products.Our economy unfortunately is also driven by black money, hoarding, mal distribution, corruption and exploitation of any crisis situation to make fast backs by anti social elements. Herein lies effective administartive measures and management of finance. Banks have a tendency to support hoarding activities and good old days they were strictly monitored and regulated. With the liberalisation, some of the regulatory measures have been removed but banks' involvement in financing such activities are not ruled out as RBI does not micro manage things under liberalised environment. A strict vigilance if kept on these activities and the government can act on black money and initiate other administrative and economic measures,inflation impact because of monsoon shortage if any can be minimised.On oil prices we have no control as such but here again  if efforts can be made to enhance exports,remittance of all export proceeds on time, contain non essential imports and maitain the value of rupee at some stable level, the situation can be managed reasonably well. Now the new Government is in power and the confidence level in the economy seems to be fast improving, the concern on account of water and oil can to a great extent be mitigated. Upside  Risk is  very high, but once it is identified and measured reasonably well, it can also be managed with  equally reasonable comfort.This article is timely and has provided sufficient warning to the Government.

Dr.T.V.Gopalakrishnan

(This comment is given to Business Standard in response to the article Oil and Water )

Make Customer Service Ratio as Part of RBI's evaluation of banks.

Like Capital adequacy ratio, there should be a ratio to analyse and  assess the level of service rendered by banks to customers based on certain parameters and this should form part of evaluation of banks by the Reserve Bank of India. Though the banks whether they are in the public or private sector  try to comply with all the regulatory requirements in adhering to KYC norms, the fact remains that bank officials do not appear to be sensitised to understand the customers and provide the service.needed by them.They are more concerned witth  the documents and not worried about the Customers, their requirements and banks own business perspective.  All are treated like cheats and rogues even if they are with the banks for decades and no irregularities have been observed in any manner in the conduct of their accounts. One has to literally fight with the officials on the rationale of transactions and even then they fail to carry out the transaction despite the customers agreement to the effect that  they are prepared to bear the risk if any and their deposits are with the banks with a general lien. Unfortunately some of the private secctor banks' staff are not even aware of the existene of an Ombudsman or a Regulator in the name of RBI and many times they express their ignorance by saying with all innocence that they have not seen such a bank in their vicinity. Whom to blame the banking Ombudsman, or the RBI or the Banks or the Customers? Pathetic state of affairs.

Dr.T.V.Gopalakrishnan

(A modified version of this comment is given to BS in response to an Article on BCBI to put customer srvc ratings of banks in public domain)

Expectations from India INC.

The PM expects a lot from India Inc.1) Run the industry on ethical lines2) Ensure that they do not default on bank borrowings3) Ensure that accounts are not manipulated 4) Do not lobby for favours 5) Ensure that they really contribute for the growth of the economy6) Ensure that  they do not nurture any greed to amass wealth exploiting the masses.6) Ensure that they pay all the taxes without fudging the accounts.7) Ensure that Corporate Social Responsibility is carried out in letter and spirit.

Dr.T.V.Gopalakrishnan 

(This comment is given in response to the news item Long List of Reforms What India Inc expects from Mr Modi)

The budget for 2014-15

The autor has given very valuable suggestions worth seriously considering by the Government. However, the thoughts are on routine lines and tinkering here and there with taxes, exemptions etc cannot be of an endurable nature to save the economy which requires out of the box thinking and very decisive actions. The very approach of the new government to tackle corruption and unearth black money if proved a success, the isssue of deficit financing for developmental needs will not arise. The structural reforms if aimed at can improve the savings and investments and the economy can expect to perform better to contain inflation and other serious issues faced by the economy. The capital market needs to be made a source of finance from household sector and capital formation from the retail investors. The dividend tax needs to be revisted and STT should emerge as a major tool to raise resources, prevent speculation and to regulate the capital market in a healthy manner.

Dr.T.V.Gopalakrishnan
(This comment is in response to the article let us get real to the Budget that appeared in BL dated 26/6/14).

Coordination is the need of the hour to bring down food inflation.

Nabard is the best medium to coordinate the centre and state in the matter. NABARD has a key role to play to develop not only agriculture and rural development, but also has to ensure that the supply chain which is the major cause for food  inflation improves.The Local Boards of the Reserve Bank of India can also be made for effective and accountable for improving the agriculture and rural sector by ensuring coordinated activities with all Central and state Level agencies involved in agriculture and allied activities with the active involvement of NABARD. If the institutions themselves do not show any enthusiasm and initiative to improve the economy, the continuance or otherwise of the institutions should be taken up for a serious review. 

Dr.T.V.Gopalakrishnan

( This comment is given in TOI in response to a report  that PM wants Centre and States to Coordinate to bring down inflation). 

Perceptions vary from person to person

This is a very clear evidence that perceptions will vary from person to person.What Dr Rajan has expressed is his concern on certain regulatory aspects where the RBI should have a full say and should be a final authority. Dr Rajan can never be different from the thinking that the the financial services system needs reforms and he has been taking all possible steps towards reforming the financial system perhaps without making any pomp and show of it with all his limitations.One major handicap for him is that RBI has autonomy only on paper and the FSLRC report wants to even take away this autonomy.

Dr.T.V.Gopalakrishnan

(This comment is given in ET dated 26/6/14 in resposnse to an article Dr rajan is wrong) 

Is there any hope for Relief for RBI Retirees?

IT IS A MATTER FOR SHOCK why the Retired RBI employees have been taken to task at once both by the Government and RBI Management by DENYING THEM their entitled periodical updation of pension on par with the Central Government pensioners.THIS is a mystery since there has been a tacit understanding to that effect. The EGO of some Government official has played havoc with the life of many a retired employees and their dependants and RBI management has not shown any  guts to sort out the issues and has been dilly dallying for more than a decade. RBI has the money and  the authority to grant the updation but it prefers to remain silent  and dance to the tune of the MoF for reasons unknown to the retirees but  perhaps well known only to  the top management. After the departure of Dr Jalan, two Governors have come and gone and they had very diplomatically side tracked the issue not showing any magnanimity in understanding the genuine concerns of retired officials and their pathetic living conditions for want of adequate pension and medical facilities. How the management and the Government can afford to be so casual, inconsiderate and insensitive to the genuine needs of the retirees when both can financially afford to meet the very genuine, reasonable and fully justifiable demands a pittance in moneatry terms, is what is surprising and is not understood?  THAT Spiralling and Persisting high inflation has not spared RBI retirees is a fact that cannot be wished or washed away.RBI does not depend on the Government for any financial support to meet the rightful needs of its retirees who are in their eighties and many from the lot have left for heavenly abode after having anxiously waited on the promises of the management that their needs would be met.

The Reserve Bank being an institution of international repute and having been a role model for Central banks of many countries in the world and domestic institutions as well cannot and should not forget and ignore the retirees who had toiled and contributed their best professionally and ethically to build its reputation, name,fame and the image it enjoys. The Human Resources   present or past who form the base for any institution or the nation for that matter cannot be so easily bypassed just because of the reason that they have no strength to fight the arrogance of the power. It can’t stand ethically, morally, socially or humanely. Justice demands that justice cannot be further delayed and retirees deserve to be given their dues at the earliest as per the agreement the Management had with the Retired Employees Association way back in 1990.

Dr.T.V.Gopalakrishnan

Make capital out of Capital Market

Make Capital out of Capital Market. Do not allow Dalal Street go the Wall Street Way

The capital market which has undergone sea changes under the initiative of SEBI over a period has been unfortunately turning out to be a den for speculation and gambling keeping away the retailers from investing and helping the capital formation very vitally needed for reviving the sagging economy. The financial savings of the households have, of late, been registering a sharp decline and the investments in physical assets have been on the increase contributing nothing to the GDP growth. For want of adequate resources, the development of infrastructure has lagged behind and the confidence in the whole gamut of savings, investment and production has shattered. The household savings in financial assets have come down sharply over a period. Retailers’ investment in capital market is insignificant if not negligible. The trend in resources mobilized over a three year period by the Corporate Sector can be gauged from the following table.

Total Resources mobilized by Corporate Sector                                             Amount in Rs crores)              

Year	Equity Issues	Debt Issues	Total Resources
2010-2011	1,14,466	2,28,236	3,42,702
2011-2012	40,729	2,96,868	3,37,597
2012-2013	78,408	3,78,444	4,56,852
2013-2014	73,394	3,18,436	3,91,830

Source: SEBI bulletin May 2014

The capital market which should reflect the strength of the economy in fact reflects predominantly the speculative tendencies based on the sentiments of a few market participants. Unfortunately the FIIS have more say in the capital market than the domestic players and they dictate the terms and conditions. The fundamentals of the economy which should be the yardstick to influence the market have been relegated to the background and the movement of indices is only reflective of movement of inflows of speculative funds of FIIS. The macro economic factors like the fiscal deficit, current account deficit, the GDP growth, inflation, value of the rupee, industrial and agricultural production etc are all weak and by any stretch of imagination one cannot explain  as to how the market indices are getting strong day by day other than by the speculative instincts. No doubt the change of the non performing Government and expectation of high Governance standards from the new set up partly account for rise in index, but it is too early to sit on judgment on Government's performance. This speculative trend seen in the capital market needs to be reversed and this is possible only if domestic institutions and corporates strengthen their resource base by tapping the domestic savings through attractive financial products including equities and bonds.

It is the best opportune moment for the new government to come out with some innovative ideas and facilities to enhance, convert and divert the household savings into investments in capital market. The investments in shares through IPOs have turned out to be a very bad experience for retailers during the last decade because of high and greedy pricing of the issues and they have burnt their fingers forcing them to go out of the market and seeking greener pastures elsewhere. Persisting high inflation has added fuel to fire. Gold and real estate have attracted huge investments over a period depleting the savings in banks and investments all around. The Rajiv Gandhi equity investment scheme introduced by the then Government offering tax exemption up to Rs 50000 investments in equity to attract retailers into the capital market has not gone well with the investors and this needs to be scrapped totally or modified drastically. Expecting people in small cities and suburbs who have absolutely no knowledge of shares and for whom having a bank account itself is a herculean task in these days of banks' insistence of KYC without understanding its' relevance, to invest in equities and that too through a demat account which is compulsory to hold the equity investment is simply unrealistic and if not totally utopian. When the Financial Inclusion particularly banking inclusion has not taken off very well, the expectation of the Government to attract savers particularly those from middle income and lower income class to equity market is unintelligible and unrealistic.     

To make the capital market a place for large savings, SEBI has to necessarily ensure that the share of retailers get augmented considerably keeping an obligatory minimum of 25% of the paid up capital of all listed companies. The companies that have exceeded this minimum and have been having more than 50% should get some special recognition from the Government and incentives. Till the Companies reach 25% of retail ownership, there should not be any STT for first time buyers of shares of these companies. To avoid undue speculation in the market, the SEBI can think of introducing loyalty bonus for retention of shares by individuals for more than a prescribed minimum period. STT can also be suitably modified to prevent speculation both on buying and selling. STT can be different for FIIS and domestic players in the market. Similarly STT can also vary for institutions and individuals. Different slabs can also be thought of for levying STT on purchases and sales. With proper modification and intelligent marketing, this can emerge as a regulatory tool to attract small savers to capital market, contain speculation in the market, mobilize maximum savings towards capital formation and enhance optimum revenues to the Government.

Corporates declaring dividends and bonus shares at regular intervals need to be incentivized. Similarly Corporates raising resources from rural and semi urban areas can also be given some tax concessions or some incentives. This will give a boost to tap household savings from these places. Domestic financial and other institutions investing in capital market and raising resources from capital market have to be facilitated with suitable products and processes   to get in and get out of the market and there should be in place effective regulation and supervision with adequate checks and balances to prevent frauds and irregularities.

The capital market is the best source of raising resources for the Government at this critical juncture and the money locked in the form of gold, real estate, hard cash and otherwise also can be easily tapped   with proper reforms in the form of policies, products and processes. Readiness on the part of the authorities is all that matters. A healthy and vibrant capital market supported by sound and proactive administration, regulation and supervision can change the economy into a most promising and prosperous one fulfilling the aspirations of the new Government and the people of this great nation.

Dr.T.V.Gopalakrishnan 

(This article has been sent to MOF for consideration in the ensuing budget).