Apropos your editorial a wake up call for our Political Leaders (ET dated 28/12/2015),
It may be observed that major institutions of the country do not enjoy autonomy is a fact and unfortunately the Political Masters seldom exhibit the wisdom to initiate action to make them strong and accountable.
The need to have a strong healthy, sound and Vibrant financial system to put the economy on the fast growth track is paramount and the fact that the financial system which is the backbone of the economy has stresses and strains due to poor health of both banks and their borrowers does not augur well for any of the stake holders of the economy. The Reserve Bank as the regulator and supervisor of banks has no full autonomy in practice to effectively control the banks because of Government’s interference on various policy issues and the appointment of Board of directors particularly in Public Sector Banks. Similarly the SEBI which Controls the corporate borrowers has its own limitations to discipline them all, the way the banks and the Reserve Bank desires. The Governance standards in the country by and large are weak and the Institutions which do not enjoy full autonomy have lots of escape routes for being not accountable for any of the lapses seen and felt in the financial system. Since the ultimate sufferers on account of lack of autonomy for these vital Institutions are the economy, the Government, depositors tax payers, banks, large Corporate borrowers and the people at large it is time our political masters realize the seriousness of the issues and provide the much needed legislative and Government support to make the Institutions strong and independent to discharge their allotted functions effectively and make them accountable. The major beneficiary will be the politicians themselves indeed.
T V Gopalakrishnan
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