Fiscal correction not to be trifled with | Business Line

Fiscal correction not to be trifled with | Business Line



Online comments posted on July 25, 2014:



How fast the
finance minister Arun Jaitley and RBI Governor Dr Raghuram Rajan imbibe the
content of four small paragraphs under the sub-heading ‘Inter-generational
equity’ will decide the time that will be needed for India Growth Story to fall
back on track. This portion of the article(highlighting the words like
‘inter-generational burden of excessive government borrowing’, ‘internal debt
explosion’, ‘consolidated sinking fund(CSF)’, ‘sale of family silver’  and ‘created money’) should be widely
circulated among policy makers and the beneficiaries of the opening up of the
economy, who, so far, belong to the higher strata of Indian society. CSF is an
idea which should be pursued vigorously. Actually, cooperatives in states like
Kerala had factored in this idea in their debenture(long term borrowing)
programmes.

The recent
tendency on the part of government to suck out created profits/surpluses from
balance sheets of statutory bodies and PSUs(including banks) will soon affect
the health of the financial sector. The suggestion that transfer of surplus
‘income’ by RBI to GOI should be allocated to the CSF should be seen in this
perspective.

Last year, I had
concluded an article in The Global ANALYST with the following observations:

“To
ensure that temptations of government emanating from external compulsions do
not dilute the strength of RBI’s balance sheet, GOI should take measures to
augment the share capital and reserves of RBI after carrying out appropriate
amendments to RBI Act. Till such time RBI should be allowed to retain surplus
income by transfer to reserves. Considering the size of its balance sheet and
the internal and external pressures on its income generating capabilities, as
also the nature of shocks the Bank has to absorb from time to time, the central
bank’s reserves need to be augmented on an ongoing basis.”

M G Warrier,
Mumbai




Comments

Post a Comment

Popular posts from this blog

NAVAGRAHA STOTRAM

NAVAGRAHA STOTRAM* According to astrology, the positions of the nine planets in the twelve constellations of the zodiac and their movements are considered to be quite significant. The nine planets ‘Navagraha’ affect every aspect of human life. They play an important role in the activities, physical and mental health and life of any individual. The unfavorable positioning of any of these planets can be the cause of problems, bad health, and stagnation for many people. However, there is a solution to avoid the ill effects of the position and movement of the ‘Navagraha’ in our lives. Navagraha mantras (or stotram) are simple mantras which work as powerful healing tools to reduce the negative effects of any of the nine planets. These mantras are Hindu holy hymn addressing the nine planets. Benefits Of Navagraha Stotram And The Way to Practice The Navagraha Stotram is written b y Rishi Vyasa and is considered to be the peace mantra for the nine planets. They are powerful m
Read more

THE SUNSET OF THE CENTURY

*SUNSET OF THE CENTURY: Rabindranath Tagore THE LAST SUN OF THE CENTURY SETS AMIDST THE BLOOD-RED COLOURS OF THE WEST AND THE WHIRLWIND OF HATRED. THE NAKED PASSION OF SELF-LOVE OF NATIONS IN ITS DRUNKEN DELIRIUM OF GREED IS DANCING TO THE CLASH OF STEEL AND THE HOWLING VERSES OF VENGEANCE. THE HUNGRY SELF OF THE NATION SHALL BURST IN A VIOLENCE OF FURY FROM ITS OWNSHAMELESS FEEDING FOR IT HAS MADE THE WORLDITS FOOD, AND LICKING IT, CRUNCHING IT AND SWALLOWING IT IN BIG MORSELS, IT SWELLS AND SWELLS TILL IN THE MIDST OF ITS UNHOLY FEAST DESCENDS THE SUDDEN HEAVEN PIERCING ITS HEART OF GROSSNESS…   *Note: “The Sunset of the Century”, translated by the poet, from Naivedya; The English Writings of   Rabindranathtagore, Volume II,Delhi 1996, page 466. Quoted in his article ‘Critiquing nationalism’ by K Satchidanandan (Frontline, November 14, 2014). The article takes you to a much broader spectrum. HAPPY READING(READ MORE STAN
Read more

The King of Ragas: Sankarabharanam

                       The King of Ragas                      --------------------------     Long ago  serpents were put to lot of hardships.They  were afraid of other animals. They had to seek refuge in the hermitage of sage Saraba.The sage was a true devotee of Lord Shiva.He used to pray Shiva with melodious songs. As he sang a particular raga the snakes were much inspired and they began to dance,. Slowly the serpents became friendly with the sage. They brought water in their mouths for the pooja.They secreted  a special fluid in which the flowers got stuck to their bodies.The sage was much astonished by the service of the snakes.As the sarpas became very close to the sage ,they requested him to help having Darsan of Lord Siva. As requested by the sage Shiva appeared in the form of  a  Kapalika and stayed in the ashram.The music and dance of the snakes continued. The snakes rendered service to the kapalika as they considered him  a Shiva bhakta.Shiva was much pleased with t
Read more