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

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Engineering Banking Sector Recovery and Growth

The idea of “bail-in” in cases of serious banking instability has been widely discussed in India ever since the introduction of the Financial Resolution and Deposit Insurance Bill. Given the large non-performing loans of public sector banks, the Government of India and the Reserve Bank of India as the regulatory authority have to quickly act to ensure that public confidence in the soundness of commercial banks is not breached. In this context, three approaches are explored that could be adopted either individually or in a variety of combinations in different proportions essentially to secure banking stability. The bail-in idea should not be considered except in extreme conditions of large financial stress. The idea could be tried even before the extreme situation arises with provision of incentives.

Reflections on Analytical Issues in Monetary Policy

Analytical issues have arisen in the conduct of flexible inflation targeting as the framework of monetary policy, adopted formally by India in 2016, despite the noticeable downward drift in the inflation rate and concerns of many economists about its relevance in the light of the global financial crisis. Issues such as the framework’s rationale, the medium-term inflation target, the meaning of real interest rate in the Indian context, the realism in respect of inflation expectations and of the inferred logic of the yield curve, and the implications for economic inequalities have been pointed out.

Comments on RBI

Letters HIV/AIDS and Orphans I n a period of two decades, HIV/ AIDS has spread with a ferocious efficiency, accentuating its impact at all levels, leaving behind a track of huge social problems. Children, innocent victims, are the hardest hit by this rampant disease. Suffering the tragedy of loss...

Great Indian Story of Convertibility

Determination of fuller capital account convertibility is not based on the contemporary thinking of economists. It is essentially led by policy-makers' preferences and judgments.

Note on Portfolio Flows into India

This note discusses the issues raised by the expert group on encouraging foreign institutional investor inflows released in November 2005. The spiral nature of the co-movement of inflows and stock prices warrants testing of the hypothesis that the surge in flows is based only on economic fundamentals or the strength of traded companies. The expert group did not make such an analysis and instead discusses the beneficial aspects of speculation. It quietly ignores the perception that sub-accounts and participatory notes provide the avenues through which some speculative flows could have occurred.

On Central Bank Reforms

On Central Bank Reforms A VASUDEVAN This comment, dedicated to the memory of I G Patel, is in the form of my reactions to the exceedingly well written article of Anand G Chandavarkar entitled,

Tribute: A Financial Journalist of the Past

A tribute to S V Rayan, who edited Commerce between 1950 and 1966, and represented views at the other end of the spectrum of Economic Weekly.

IMF's New Guidelines on Conditionality

Will the IMF's new guidelines on conditionality, the outcome of a review initiated some two years back in response to criticism of the Fund's handling of the adjustment problems of crisis-hit countries in Asia, make a difference to countries' adjustment efforts in the future? How far are the new guidelines different from the 1979 ones?

Evolving Monetary Policy in India

This paper reviews the process of monetary policy formulation, with some stylised facts monetary policy currently pursued. Issues concerning the objectives and conduct with reference to targets and the indicators are discussed. Some possible areas where future research on monetary policy could be focused are also suggested.

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