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

Articles By Liberalisation

Impact of Bancassurance on Banking-Insurance Sector in India

Bancassurance is an agreement between banks and insurance companies to sell insurance products to bank customers. An insurance company develops a product line for bank customers as part of their collaboration, which is then distributed through bank branches, a hotline, or internet banking platforms. Though the insurance density had progressed significantly since its inception in 2000, the insurance penetration remained low even after two decades of liberalisation in the insurance sector.

Outward FDI and Cross-border M&As

Although the new foreign direct investment policy and other policy packages, including “Make in India,” is expected to tap more foreign savings and better technology and transform the Indian economy into a manufacturing hub, most successful firms are investing abroad. Given this context, this paper makes an effort to understand the trends and nature of outward foreign direct Investment by Indian firms and their implications. The paper argues that though the Indian overseas acquiring manufacturing firms perform relatively better than their counterparts, its adverse impact on the trade deficit and balance of payments need to be tackled.

Is India Ready for Tariff Reforms?

Recent trade models with fi rm heterogeneity predict that trade liberalisation reduces the number of fi rms and the fi rms’ markups, while it increases the average size of fi rms. The present study attempts to test these predictions in the context of trade reforms in India with the Annual Survey of Industries data over two decades (1987–88 to 2017–18) by using a difference-in-difference approach and comments on the recent policy framework in that light.

India’s Far from Neo-liberal Economic Order in the Modi Era

India’s economic order is far from neo-liberal. The state, and thus politicians, have retained very substantial powers over market forces. Expectations that the Modi government would liberalise audaciously have been disappointed. Especially since mid-2019, it has used its remaining powers to intimidate corporate interests, in pursuit of its main objective: top-down control over all power centres. Thus, in crucial ways, the economic order has become less liberal (or neo-liberal) than before.

Is ‘Islamic Finance’ Islamic?

Riba could mean usury, interest, economic rent and even surplus value (in the Marxian sense). Riba is “un-Islamic.” Without riba, capital accumulation, and capitalism itself will not be possible. However, those who own capital in the Muslim world have taken charge of defining what is Islamic and what is not. The result? They find ways to multiply it in modes that benefit only themselves, just as their non-Islamic counterparts.

Effective Tax Rates for Indian Companies Post-liberalisation

This article studies the effective tax rate for Indian companies from 1990 to 2010, covering the period just before liberalisation of the economy and tax reforms in 1991 and later. It examines the effect of a declining corporate tax rate on the gap between book profit and taxable profit. A narrowing gap between statutory tax rates and effective tax rates after liberalisation indicates increased voluntary compliance.