Showing posts from November, 2016


Despotic criticism This refers to the report “Notes withdrawal, a despotic action: Amartya Sen” (The Hindu Business Line, December 1). Nobel Laureate Amartya Sen has not added to his glory by describing demonetization of high value notes by India as a “despotic action”. Stretching the argument, any government action, anywhere in the world can be alleged to be ‘despotic’. Demonetization has been used as a tool in currency management in India and elsewhere in the world also in the past. This time around (demonetization announcement by Prime Minister Modi on November 8, 2016), India really did not ‘demonetize’ the Rs500 and Rs1000 notes in the strict sense of the word demonetization. Leaving the sanctity of the promise and the government guarantee on the currency notes in tact, it was announced that these notes will not be ‘legal tender’ from the midnight of November 8, 2016. There is substance in the criticism that backward and forward linkages were not perfectly tied up by G


The Glory of His Nama* The very name Siva spells auspiciousness and even a casual utterance of the name confers untold benefits and is capable of freeing one from all sins immediately. Such is the spontaneous outburst of Sati in the sacrificial hall when she sees the irresponsible Daksha’s open enmity to Siva, said Sri Damodhara Dikshitar in a discourse. She is already upset by the lack of cordiality to her arrival and she regrets her coming to the yagna against Siva’s wishes. She is now angry about Daksha’s deliberate denial of the allotted portion of the sacrificial offering to Rudra. Not only is this an insult to Rudra but a great error on his part to go against the rules of the sacrifice, says Sati. In great anger she says that Daksha is under the false impression that he is all powerful and rich and that Rudra, the protector of dharma is only an insignificant being. She is ashamed that she was born to such

Modi is running away with the game

Modi is running away with the game : He’s changing the narrative from combating black money to using it to help the poor, and the Opposition is clueless... Excerpts: " The point is that Modi seems to be several steps ahead of the Opposition in strategising and is now setting the agenda. We should not be surprised if in the coming Budget he cuts I-T rates or raises the threshold for middle-class taxpayers. Or if he decides to deposit a small sum into all Jan Dhan accounts. He will, of course, spin it out as a ‘reward’ for those who suffered yet stood by him."


Cooperation must succeed! On December 2, 2016, Supreme Court will be hearing the plea from 14 District Central Cooperative banks from Kerala ‘seeking a nod to transact business like banks’, along with a bunch of petitions on demonetization of Rs500 and Rs1000 before the Apex court. The problems faced by cooperatives in Kerala, post-demonetization, have much deeper roots and they have, beyond legal implications that will be gone into by the Supreme Court, jurisdictional, historic and political implications, which need to be addressed ‘out of court’. Post-independence, though India’s development initiatives heavily depended on the efficient functioning of public sector undertakings (central and state level) and cooperatives (as commercial banks did not reach out to semi-urban and rural areas, majority of the rural population depended on various categories of cooperatives), both these institutional systems failed to get the nurturing needed from governments to change with the

It’s time to make poll funding transparent

It’s time to make poll funding transparent : After demonetisation, the BJP should take the initiative by raising election money entirely through memberships... Poll funding There should be follow up on the thoughts expressed in this article. It is possible to break from the past. The political parties can be made accountable for the resources they mobilize. Each constituency in India can fund the election expenses of candidates fighting election from the respective constituencies. Centralized mobilization and distribution of funds by parties also contribute to vested interests dominating the 'business of election' M G Warrier

Krishna for Today: SharngapaNi. #indianink #watercolor #krishnafortod...

Krishna for Today: SharngapaNi. #indianink #watercolor #krishnafortod... : SharngapaNi. #indianink #watercolor #krishnafortoday 

Centre-state relations Centre-s tate relations Louise Tillin’s article “The centralizing instinct”*(The Hindu, November 28) opens a debate on right notes and needs to be taken forward. Many things have changed in India in the last 65 odd years after ‘We The People’ gave the Indian Constitution to ‘Ourselves’. To look at some select areas, for the first two decades that followed the adoption of the constitution, the country at national and state levels was ruled by Congress, the size of the economy which was small in 1950’s has now grown multi-fold and geographical divisions too have undergone changes.  All these call for appropriate adjustments in resources mobilization and its distribution, sharing of responsibilities between Centre and states and a re-working of the federal system of governance which we accepted in the first place. In 2014, Modi coined the new concept of cooperative federalism and it was best

The Curse of Cash: Book Review

Book Reviews* FINANCE & DEVELOPMENT,   September 2016, Vol. 53, No. 3 A Barbaric Relic Kenneth S. Rogoff The Curse of Cash Princeton University Press, Princeton, New Jersey, 2016, 248 pp., $29.95 (cloth). The Johns—Law and Keynes—strove to defenestrate gold, and they rather liked fiat paper. But advances in payment technology have always driven both new payment media and monetary theory. Technology is such that physical media can now mostly be abandoned in wired societies. In   The Curse of Cash , Kenneth Rogoff passionately presses the case that they should be eliminated because the social ravages of paper currency far outweigh the benefits. If such a plan is ever fully implemented, this book will have been at least its initial, if not ultimate, blueprint. Meticulously written, it covers everything needed for such a monetary reform. But the book is not excessively polemical. Rogoff details almost all the arguments against tinkering with paper currency, then labor

Co-opt former Prime Minister!

The Hindu Business Line, November 26, 2016 Letters CO-OPT MANMOHAN SINGH'S EXPERIENCE AND WISDOM TO FIGHT CORRUPTION Manmohan Singh’s advice to ‘reflect’ on the content of his speech needs to be taken seriously by all including the victims (common man) and factored into their future action plans. Instead of alleging that he did not act or speak at the appropriate time or at appropriate fora, policymakers should co-opt the former PM’s experience and wisdom to make corrections in the crusade against corruption, fake currency and terrorism. MG Warrier Mumbai
WEEKEND LIGHTER: MMS speech in RS (November 26/27, 2016, No.50/2016) Weekend Lighter is posted every Saturday Feel free to mail your views on this edition of WL to Demonetization worries, Bloomberg style… I Opening remarks Manmohan Singh’s RS speech This refers to the report “ Govt. must take action: Manmohan”(The Hindu, November 25) filed by  Vijaita Singh and Suhasini Haidar. The managers of the Indian Economy and the Indian Financial Sector, who opted to procrastinate action against the looting of the common man in India post-liberalisation should pro rata share the entire blame contained in the Manmohan Singh’s 6 minutes speech. Generations to come will remember MMS for this speech, as it is not a political speech, but one backed by long years of experience as economist of international repute, central banker, finance minister and Prime Minister. Dr Manmohan Singh’s advice to ‘reflect’ on the content of his speech n

Demonetisation is organised loot of common people: Manmohan

Demonetisation is organised loot of common people: Manmohan : Jaitley says maximum black money was generated during UPA regime... Organised loot, since when?* This refers to the report "D:emonetisation is organised loot of common people: Manmohan”(The Hindu Business Line, November 25). The managers of the Indian Economy and the Indian Financial Sector, who opted to procrastinate action against the looting of the common man in India post-liberalisation should pro rata share the entire blame contained in the Manmohan Singh’s 6 minutes speech. Leaving the harsh words used aside, generations to come will remember MMS for this speech, as it is not a political speech, but one backed by long years of experience as economist of international repute, central banker, finance minister and Prime Minister. It is another matter, he controlled the simmering anger for almost a quarter of a century. Dr Manmohan Singh’s advice to ‘reflect’ on the content of his speech needs to be taken s

WHERE ARE OUR LEGAL PHILOSOPHERS? The Hindu, November 24, 2016 Excerpts: Propounding legal principles Through the centuries, many legal philosophers left their indelible mark on shaping institutions of governance. Many of the systems of governance and rule of law as are familiar today have been developed by applying principles expounded by legal philosophers. To Aristotle, justice was all about “giving every person his due” and the purpose of law was to develop a just society that made this possible. Kautilya’s  Arthashastra  postulated that the king was the fountainhead of justice but with the limitation that even he was obliged to rule according to the  Dharmashastras . William Blackstone, through his book,  Commentaries on the Laws of England , guided the growth and development of English law in no small measure; John Austin popularised the theory that law was command of the sovereign made credible

Central banker missing in action as India escalates war on cash

Central banker missing in action as India escalates war on cash : As India undergoes the world's biggest currency overhaul in decades, one official is noticeably absent: central bank Governor Urjit Patel... Demonetization worries, Bloomberg style The Bloomberg story filed by Vrishti Beniwal & Anirban Nag captioned “Central banker missing in action as India escalates war on cash” (Business Standard, November 24) , following closely on the heels of a BBC lament about how India will handle 20 billion pieces of useless currency notes, is interesting reading. Let us not underplay the anxieties of external agencies, though they have only pedestrian interest in our real problems. Let us go by the same priorities listed in the report. First, RBI Governor has spoken just only once, since November 8 announcement of demonetization. Earlier, someone had researched and found out that during the entire 2 years plus tenure as Deputy Governor, Urjit Patel had made only one public spe

What about cash that doesn’t return?

What about cash that doesn’t return? : Transferring RBI’s windfall gains, arising out of demonetisation, to the Centre is a perverse way of bridging the... Excerpts: " The accounting part is now well understood. On the day of transfer, it is buyback of old debt by the Government from the RBI. Any other use of this fund by the Government can impact fiscal discipline. Moreover, if currency in circulation goes up through large government expenditure, an opportunity shall be lost to reduce the currency-GDP ratio, which is as high as 12 per cent in India compared to about 4 per cent in other emerging economies. The Government should exploit this opportunity to popularise non-cash payments. The windfall gain for the RBI need not be treated as windfall loss for the system. Pending improvement of banking habit of the people towards a less cash society, both the RBI and banks shall work as conduit for restoration of currency in circulation as per demand through day-to day liquid

Small change

Impact on agriculture : It refers to “Agriculture ravaged by liquidity crunch” ( November 23). There is no doubt that the negative effects of cash demonetisation were mostly felt by the farmers who were ready to start sowing rabi crop. The... The Hindu Business Line, November 24, 2016 Letters Small change This refers to Vinson Kurian’s report ‘Local service providers, shopkeepers go for the ‘swipe’ to keep the business running’ (November 23). The solution for the post-demonetisation problems will lie in: ensuring adequate availability of ₹100 and below currency notes across the country; planning the changes in collection of used notes; and rationalising deployment of ATMs in cities and towns to make more of them available in suburban and rural areas. A cashless economy is not that near. But ‘household’ stock of high value notes can be bought down drastically, while the need to ensure adequate supply of lower denomination currency should not be underplayed. Coins and notes with religiou

Taming the killer monster

Taming the killer monster K Balakesari’s article “Rerailing the Indian Railways” (The Hindu, November 23) should be an eye-opener for the policy makers responsible for reforming Railways and provides useful information to those who quickly blame the employees of the organization concerned, whenever something goes wrong in the system. If the Indian Railways with its massive responsibilities is still functional, the major part of the credit should go to the thousands of Railway employees (including retired railmen engaged on contract basis for various skills they could not pass on to the next generation of Tech-savvy ‘engineers’, but are relevant as the infrastructure has not been modernized) who  work 24X7. The letters I and R which stand for Indian Railways, do stand also for the Integrity and Reliability of the workforce which run the Railways. If 70 percent of the accidents are attributed to ‘staff failures’, one can easily assume that the stress put on employees due to overwor

Krishna for Today: Eternal companion #krishnafortoday 

Krishna for Today: Eternal companion #krishnafortoday  : Eternal companion #krishnafortoday...  You will love this drawing... M G Warrier

Demonetisation has missed its target

Demonetisation has missed its target : The currency crisis has hit ordinary folk, while the big fish are sitting pretty... Excerpts: " For instance, your housemaid and mine, whose husbands maybe daily wage or blue collar workers in shops and offices, don’t have credit cards. She goes to the local grocer to buy a quarter kg of tomatoes, half a kg of onions or 200 gm of mutton/chicken. Do the places they buy their food from accept credit cards; is their average spend ₹2,000? If these people in our metros were trapped by the demonetisation move, imagine the plight in India’s hinterland, where it is not only superfluous, but cruel to talk about the need to usher in a cashless economy. Let's not forget that only 27 per cent of Indian villages have a bank in a radius of 5 km. Now think of the truck driver who eats in the roadside  dhaba , the farmer, the agri labourer, the  potti kadai owner in tens of thousands of Indian villages — the list is endless. All of them are in distress.&

Demons of demonetization: Vivek K. Agnihotri Please use the above link to read the Hindu Open Page article by Vivek K. Agnihotri Demon(ET)isation! Vivek K. Agnihotri’s Open Page article “The demons of demonetization”(The Hindu, Open Page, November 22) is the best article yet, I read on the subject from November 9, till date. The piece stands out in coverage of several dimensions of the measure, its current and future impact on the concept of currency as an instrument of exchange and the agony and ecstasy felt and enjoyed by the common man during the last fortnight. From Trump’s triumph to ‘drowning of sorrows’, the narrative is well decorated. The only conspicuous omission-being a Malayalee and an ex-auditor (two-in-one!), I am trained to pick up at least one hole in any perfect creation- one can point out is that the writer spares the media-social, anti-social, electronic and print- left their half-done stories on the midnigh

Sitaram Yechury: Corporate funding of political parties should stop

Sitaram Yechury: Corporate funding of political parties should stop : Corruption will double with Rs 2,000 notes. As far as stopping corruption is concerned, you are only looking at its demand side... Consensus on corruption This refers to the piece “Corporate funding of political parties should stop” by Sitaram Yechury (Business Standard, Opinion, November 20). Yechury’s speech in the Rajya Sabha on November 16, signals a possibility of consensus on possible sources and uses of funds raised by political parties and broad agreement on transparency in election expenditure. Time is opportune for Modi government to make the right moves to initiate processes to formally debate state funding of election expenditure. Several related issues will crop up, if a serious proposal of this nature is discussed in public. Sitaram Yechury has suggested stopping corporate funding of political parties. This is easier said than done. It may not be practical to ban private contributions to poli : A new book has claimed that as Congress president, Indira Gandhi used “communal Hindus” in Kerala to overthrow E.M.S. Namboodiripad’s communist government in 1959. In Feroze, the forgotten Gandhi... Excerpts: " A new book has claimed that as Congress president, Indira Gandhi used “communal Hindus” in Kerala to overthrow E.M.S. Namboodiripad’s communist government in 1959. In   Feroze, the forgotten Gandhi , Swedish author Bertil Falk has reported that Indira Gandhi felt that her father and India’s first Prime Minister Jawaharlal Nehru was “indecisive” on communism, even as her parliamentarian husband, Feroze Gandhi, opposed her deal with “caste monsters” of the State. “She orchestrated the unrest from New Delhi through her loyal AICC workers in the State. And she did it hand in hand with the communal Hindus in the state and with the Muslim League,” Mr. F