The Week That Was

The equity market and the rupee staged a comeback which coincided with the change of guard at the RBI.

September 06, 2013 6:20 IST | India Infoline News Service
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Raghuram Rajan checks in; markets rejoice

At a time when financial market are volatile, and there is some domestic political uncertainty because of impending elections, the Reserve Bank of India should be a beacon of stability, says the new RBI Governor Raghuram Rajan. The equity market and the rupee staged a comeback which coincided with the change of guard at the RBI.

Following is an extract of what Dr. Raghuram Rajan said as soon as he took charge:

These are not easy times, and the economy faces challenges. At the same time, India is a fundamentally sound economy with a bright future. Our task today is to build a bridge to the future, over the stormy waves produced by global financial markets. I have every confidence we will succeed in doing that. Today I want to articulate some first steps, concrete actions we will take, as well as some intentions to take actions based on plans we will formulate. The plans involve considerable change, and change is risky. But as India develops, not changing is even riskier. We have to keep what is good about our system, of which there is a tremendous amount, even while acting differently where warranted. The RBI has always changed when needed, not following the latest fad, but doing what is necessary. I intend to work with my excellent colleagues at the Reserve Bank, the senior management of which is represented around this table, to achieve the change we need.

Finally, a personal note: Any entrant to the central bank governorship probably starts at the height of their popularity. Some of the actions I take will not be popular. The Governorship of the Central Bank is not meant to win one votes or Facebook "likes". But I hope to do the right thing, no matter what the criticism, even while looking to learn from the criticism – Rudyard Kipling put it better when he mused about the requirements of an ideal central banker in his poem "If":

If you can trust yourself when all men doubt you, But make allowance for their doubting too:

We will fill in details of what we have announced shortly, and lay out a broader roadmap of reforms soon after. Appropriate notifications will be issued shortly. As this is underway, we will turn to preparing the mid quarter policy statement." ... Read More

RBI may announce bank licences by Jan 2014: Raghuram Rajan

Adjustment in rupee was called for: Rangarajan

Rajan promises bold reforms, predictability in policy,

RBI to announce mid-quarter monetary policy on 20 Sept

"I will miss the hustle and bustle of RBI": D Subbarao

The outgoing RBI governor D Subbarao has advised his successor to emulate Arjuna and get the economy out of the Chakravyuh, according to reports. Subbarao, said he would have liked to hand over a stable economy. Subbarao, took charge at RBI in 2008 and made transition from finance ministry to RBI within 24 hours.

In his farewell speech , Subbarao said he has drawn up a list of things he would like to do after demitting office, which includes learning the Salsa dance. Subbarao reported "I will miss the hustle and bustle of RBI, miss being important, miss being mollycoddled," he said.

Adopt simple method for claim settlement of deceased: RBI

The Reserve Bank of India directed all banks to adopt a simple procedure for hassle-free settlement of claims of a deceased depositor.  "We have been receiving feedback from public that banks are not following the simplified procedure as advised. Banks are therefore advised once again that they should strictly comply with the instructions for hassle-free settlement of claims on the death of a depositor," RBI said in a notification on Tuesday. Further, it asked banks to provide claim form for settlement of claims to any person who approaches the bank for such forms, so as to settle claims on time. "Claim forms may also be put on the bank's website prominently so that claimants of the deceased depositor can download the forms without having to visit the concerned bank," it added further.

Cos to use ECBs for general corporate purposes: RBI

India's external debt declines with fall in imports: RBI

RBI tightens norms for disbursal of home loans

RBI revises gold import norms; SEZ supplies not exports

PM statement in Lok Sabha on files/papers

Following is the text of the statement made by the Prime Minister, Dr. Manmohan Singh, in the Lok Sabha, on the files/papers yet to be supplied to the CBI:

"With regard to the so-called missing files or papers pertaining to the ongoing investigation into allocation of coal blocks, I would like to emphasize that the Government is making all efforts to locate the papers requisitioned by the CBI and, at this stage, it would be premature to say that some papers are indeed missing. A vast majority of the papers sought by the CBI have already been handed over to them. However, disregarding the factual position, some members have gone ahead and drawn their own conclusions that there is something fishy and the government is hiding something. Let me assure this august House that the government has nothing to hide. The fact that more than 150,000 pages of documentation have already been handed over to the CBI clearly shows that our intention to facilitate the process of investigation cannot be called into question. Right from the days the CAG began its exercise of performance audit, the government has always provided its fullest cooperation to the CAG and later to the CBI. We will continue to do so. If the records in question are indeed found missing, the government will carry out a thorough investigation and ensure that the guilty are brought to book...Read More

Support probability for bank subdebt falls in Asia-Pacific: Moody's

Moody's Investors Service says that the support probability for bank subordinated debt (subdebt) across banking systems in Asia-Pacific has fallen significantly fallen since the global financial crisis.  Tremblay was speaking following Moody's announcement on 5 September of ratings downgrades for the legacy subdebt (Basel I/II Lower Tier II) for 40 of the 43 banking groups it had reviewed, across 8 banking systems in the region (excluding Japan). These banking groups are domiciled in Australia (8), Hong Kong (6), India (11), Korea (8), the Philippines (3), Singapore (3), Taiwan (1) and Thailand (3). Moody's followed the rating actions with its release of a special report, authored by Tremblay and titled "The World Has Changed: The Support Probability for Bank Subordinated Debt in Asia-Pacific Has Significantly Diminished". As the report notes, willingness to support the subdebt of distressed banks has evolved, with initiatives implemented by the European authorities acting as a key catalyst behind the shift. And, because of fiscal strains, there has been a strengthening in the willingness of governments to impose losses on subordinated creditors outside of bankruptcy...Read More

Friday fiesta...Nifty ends above 5650

The Indian equity market extended its winning streak for the third consecutive trading session with the Nifty ending above the 5650 mark. The banking stocks led the rally after RBI decided to permit banks to issue bank guarantee, without prior approval of the central bank. The oil marketing stocks also flared with stocks like IOC, BPCL and HPCL rose sharply after reports stated that a decision on raising diesel prices by Rs 3-5 per litre, kerosene by Rs 2 and LPG by up to Rs 50 per cylinder will be taken after UPA Chairperson Sonia Gandhi returns from US. Among the other major gainers were, capital goods, power, healthcare, telecom and metals stocks. The IT sector remained under pressure as the Indian rupee traded flat on Friday, but choppiness in the currency rose, a day after it saw the biggest gain in a week. The Indian unit was trading around the 66 per dollar levels. BSE Sensex closed at 19,270 up 290 points, while NSE Nifty closed at 5,680 up 87 points over the previous close...Read More

Sensex, Nifty snap six week losing streak 

News In Focus

Light, sealed & hard sided is what your bag should be when travelling: Skyscanner

Has an airline ever lost your bag? Want to know what really happens to your bags when you wave them goodbye at the airport? Leading global travel search site Skyscanner interviewed a baggage handler at a major international airport who revealed the truth about your suitcase at airports.

1. What’s the most common cause of lost baggage?

The most common cause of lost luggage is when people check in their bags at the very last minute. Another common occasion is when people transfer between flights.

2. How often do things get stolen from bags?

I have only experienced this once. We see quite a lot of professional football teams going through the airport for international Champions League and Europa League football matches and once the guys who loaded the bags into the plane got hold of a captain’s arm band of a famous club. Apart from that I have never experienced any instances of anything like that.

3. Do baggage handlers ever purposely put bags on the wrong flight?

No, I have never seen this happening (at least not on purpose)...Read More

EPFO to start online facility today to view updated accounts

Retirement body EPFO (Employees' Provident Fund Organisation) will launch an online facility today where over 50 million subscribers can track their accounts online on a real-time basis and check their updated accounts. The objective is to make the EPFO online system customer friendly. The online facility will enable subscribers to see their updated accounts and take printouts for their records. EPFO is also working on to restructure its customer identification system and plans universal number for every member from this fiscal. The universal number will work like a bank account and whenever an employee shifts job, the new employer will feed in the unique number into the system for continuation of the fund.

Insurers should have their own distinct trade logo: IRDA

88% of Indian "Share" social media content monthly: Ipsos

About nine in ten (88%) online consumers in India indicate that in the past month, they have shared some type of content on social media sites compared to 71 globally. The findings reflect a new poll of 18,150 respondents conducted by Ipsos OTX – the global innovation center for Ipsos, the world’s third largest market and opinion research firm. About one in ten (12%) indicate they ‘haven’t shared any content in the past month.’ The most popular shared item found in the poll is pictures, as about six in ten (58%) indicate they have shared pictures online in the past month. Following next are: ‘my opinion’ (56%), ‘links to articles’ (37%), a ‘status update of what/how I’m doing’ (36%), ‘news items’ (34%), ‘something I like or recommend, such as a product, service, movie, book, etc.’ (32%), ‘status update of what I’m feeling’ (29%), ‘video clips’ (29%), ‘links to other websites’ (27%), ‘reposts from other people’s social media posts’ (25%), ‘plans for future activities, trips, plans’ (17%) and ‘other types of content’ (15%)...Read More

11% of Urban India has embraced cashless transactions: IAMAI

Approximately 11% of urban Indian households have embraced cashless transaction that can set the tone for more people to use less cash. However, penetration of cashless transaction stands at measly 0.43%. It has been seen that only about 3.6% of the households in India make cashless transactions. Two main reasons for 94% not using cashless transaction are i) Seller not accepting cards and ii) Lack of awareness amongst consumers. With over INR 1 trillion of cash circulating, a transformation of 1% moving to cashless transactions can reduce cash circulation by INR 1 billion. According to a report ‘Road To Less Cash’, by India Development Fund (IDF) and Internet and Mobile Association Of India (IAMAI), and sponsored by Visa and ItzCash, a moderate growth of cashless transactions by 5 percent a year will save the country more than INR 500 crore annually. The report goes on to add that Inducing MNREGS beneficiaries to undertake cashless transactions would immediately mean that around 52 million households from rural India will be part of the cashless network. A modest amount (10%) spent on cashless expenditure from the MNREGS payment would immediately mean that close to INR 3000 crore will be the additional cashless transaction leading to an annual savings of INR 25 crore on printing and managing currency...Read More

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