FIIs and government securities market

The government is contemplating increasing the FII limit in government securities market. This it seems would allow the smooth sailing of the large government borrowing programme without crowding out the private sector borrowings. This is not a very convincing argument for broadly two reasons:

There is no pressure on the bank credit that there would be crowding out. Moreover, the first half is the slack season and private sector borrowings are not large. So, the stated reason for allowing FII does not appear to be genuine.



The other reason why this is not a welcome position is because of the redemption pressure would emante once these fair weather friends decide to repariate their savings. At that time there would be double whammy on debt side and foreign exchange side.



Hope good sense would prevail....

Idea's advertisement

The advertisement by idea which rejects the notion of jat and all other forms of distinction, instead favours recognition through numbers which is portrayed to ensure equality. But, i really wonder if this would happen. Even if tomorrow all of us have to abandon our names and family names and would be given just plain numbers, we would continue with differentiation; because we are born with different characteristic, which numbers cannot hide. Differentiation based on gender, colour and of course looks will continue for time immemorial.
Hence i think that what the ad i trying to convey is not on a firm footing. It may appeal to the viewers as the pictuarisation is quiet good but as a socially viable concept this does appeal to me.

New Commodity Exchange

It seems that MMTC and India Bulls are planning to set up yet another commodity exchange. The regulator, FMC, is still contemplating about whether there is a need for another exchange.

Wonder why is FMC taking so much time? the commodity space is definitely much larger than equities and there is a need to reach all and another exchange provides the infrastructure to achieve this goal.

A thought provoking quote

Advocates of capitalism are very apt to appeal to the sacred principles of liberty, which are embodied in one maxim: The fortunate must not be restrained in the exercise of tyranny over the unfortunate. - Bertrand Russell

Happy Diwali

Wishing a Very Happy Diwali and Happy New Year

Reservations

Its after a long time that the citizens of our beloved country have chosen to express their views and that too in a manner that those in power have to listen to their voices. In a way, I am feeling gratified that not all Indians are impervious of any developments affecting their lives or their future. Interestingly, the increased quota for the OBCs is set to affect students from all streams, but only the medical students have chosen to protest against this policy of the government. They have peacefully protested against the ploy of the politicians to vouch for vote banks in the upcoming elections; however as their voices have fallen on deaf ears.

This development has raised some intriguing questions in my mind: why have students of other streams not supported this cause taken up by the medical students across the country. In the olden days, whenever there was protest against injustice – say against the English rulers- the protest would not spread because of lack of communication. Interestingly, the war of 1857 should the power of networking in an age when net or media played almost no or miniscule role. Its depressing that the other streams of students have preferred to remain silent observers and allow their destiny to be jettisoned by these politicians. They will revolt back, but not by raising voices against it, but by applying for foreign country citizenship.

The other question is why can’t economic criteria be used as an important indicator for backwardness and for how many years are we going to ask for it?
Its time that the politicians explains us that why an economical sound person is not socially uplifted one?

Finally, why have not data being published and analysed about the benefits reaped by those who have used the reservations ? have the benefits really reached the lower rungs or the middle class are the ones who have benefited? Has the system which has been in place for last 56 years delivered the results ? is it not a time for rethink on these issues ?

Growth rates

Recently, I have come across articles stating that higher GDP growth does not ensure that the Indian economy will be become a giant nation because there a still many areas that need to be addressed: they are rural –urban divide in terms of infrastructure and income levels, inequalities, abject poverty and unemployment are some of them. The authors have said that there is need to review the wisdom that higher GDP growth as a panacea of all ills. Though these authors have put across this wisdom as something new, it is in reality a revisit to the ideas put forward in 1970s when many middle incomes countries, which grew at astonishing growth rates faced problems associated with health, education and poverty. Even UN recognised the importance of basic needs.

Sometimes I wonder, that the memory of not only the voters but also reviewers is relatively short.