ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Are Indian NBFCs Shadow Banks? Do They Pose Systemic Risks?

An ongoing debate in India is whether or not Indian non-banking fi nancial companies (NBFCs) are “shadow banks”. This question appears important because we have learned from the ongoing global fi nancial crisis that shadow banking might create systemic risks which have been defi ned “broadly as the...

A New Growth Consensus?

The Reserve Bank of India and the government are taking contradictory approaches on liquidity and interest rates. The one eases liquidity but keeps interest rates high, the other promotes debt-financed consumption and pushes for cheaper consumer credit. This seems to be a new growth strategy based on a combination of liquidity infusion and interest rate reduction for consumer loans. But is this prudent? What of the fragility of the financial sector?

How Much Capital Does a Bank Need?

Most companies would think twice before operating at a debt to equity ratio (or leverage) of 2:1. Some capital-intensive businesses, such as shipping, opt for a ratio that is considered outlandish say, 5:1. But banks really take the cake. A leverage of 25:1 is not uncommon in banking. During the fi...

Government's Gift to SBI Shareholders

In August 2010, the then Union Finance Minister Pranab Mukherjee sought to cut the government’s stake in the State Bank of India (SBI) from 55% to 51% and push the bank to raise more capital from the market. Good idea. But, in a course reversal, on 5 December 2012 – at a time when the government’s...

Keep Off Education

Today it is the Brihanmumbai Municipal Corporation's decision to privatise its schools, tomorrow it may be the resolution of all the other municipalities of the country.

Redistributing Regulatory Power

The Financial Sector Legislative Reforms Commission has exploited its ambiguous terms of reference to suggest a complete revamp of financial regulation. The recommendations, if accepted, would shift power from Parliament to "independent" bodies run by nominated experts and subject to scrutiny by a legal framework that might be capable of judging fairness of regulatory reach but not its appropriateness from the point of view of development. This is no legislative reforms commission but a commission that is serving as a vehicle to legalise a regulatory structure suited to a liberalised financial sector.

Ambedkarites against Ambedkar

It is one thing to revere one's hero but quite another to consider him to be god. Following Ambedkar means being inspired by his vision of "liberty, equality and fraternity" and acting in accordance with his advice to "educate, agitate, organise" so as to realise his goals of annihilation of castes and achievement of socialism.

Criminalising People's Protests

The manner in which Irom Sharmila's demand for the repeal of the draconian Armed Forces (Special Powers) Act has been handled by the Indian state is indicative of its intent to further narrow the scope for democratic protest, even opposition that is centred on the right to life itself. With such actions, the state is subtly communicating to the people that there is no democratic option left in the country.

In Defence of Prakash Ambedkar

Prakash Ambedkar's recent statements that the political reservations given to dalits (scheduled castes) and the requirement of mentioning caste in school leaving certifi cates should be done away with, as also his stand against the hanging of Afzal Guru, all of which have evoked varied reactions, need to be refl ected upon.

World Investment Outlook

Where to invest? Those with cash or charged with investing other peoples’ savings have had a serious headache over the past two years. The world is a deeply uncertain place right now. This normally indicates an attraction for bond markets – which in traditional versions offer a fixed interest rate...

Delhi Gang Rape Case

Why is it that heinous crimes -including the rape and murder of Surekha and Priyanka Bhotmange in Khairlanji - against dalits have failed to provoke anger amongst the larger Indian public? Were they any less gruesome than the recent Delhi gang rape? Even in the case of Khairlanji, despite spontaneous dalit protests lasting for over a month in Maharashtra and beyond, not even the so-called progressives had joined them. It was natural therefore that dalits felt alienated from the upmarket uproar against the Delhi gang rape.

FDI in Retail and Dalit Entrepreneurs

Questioning the thesis that foreign direct investment in retail will have a favourable effect on the fl edgling class of dalit entrepreneurs in India because processes of capitalist modernisation automatically undermine the significance of social identities like caste, creed and race, this article argues that only a minuscule section of dalits has benefi ted from globalisation while the majority, being "uncompetitive", has been pushed to suffer ontological insecurities and existential uncertainties.

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