Narendra Modi

Showing posts with label Narendra Modi. Show all posts
Showing posts with label Narendra Modi. Show all posts

Monday, 29 December 2014

Bankers not expect Some Hard Questions from PM Namo in Next PSB Meeting


Prime Minister Narendra Modi will hold discussions with public sector banks (PSBs) and financial institutions to draw up an action plan for banking reforms in "a top-level, two-day retreat for banks and financial institutions" branded "Gyan Sangam" in Pune on January 2-3.

Finance Minister Arun Jaitley, Reserve Bank of India (RBI) Governor Raghuram Rajan, the minister of state for finance, Jayant Sinha, and top officials of the finance ministry, including Finance Secretary Rajiv Mehrishi and Financial Services Secretary Hasmukh Adhia, will be there, too.

Friday, 17 October 2014

Modi is Taking Crucial Decisions for Economy


{{ The Guest Post Blogger organization was not involved in the creation of this content. - Dalvi Prabhakar B, Founder & Digital Manager (SEO,SEM,SMO) }}(M.K. Venu is Executive Editor of Amar Ujala publications group)

Domestic and global investors looking at India with renewed interest had, of late, begun asking this one leading question - when will Narendra Modi return to proper economic management and start taking critical decisions relating to the economy? The Prime Minister has partially answered them with finance minister Arun Jaitley  appointing a new Secretary to head the Department of Economic Affairs (DEA) and finally picking a Chief Economic Advisor known for his strong reforms credentials. The NDA government had oddly been without a Chief Economic Advisor after the post fell vacant last year.

Rajiv Mehrishi, Chief Secretary in Rajasthan, will soon take over as Secretary, DEA and US-based economist Arvind Subramanian will take charge as Chief Economic Advisor. As a matter of protocol, the CEA works very closely with Secretary, Economic Affairs on all macro policy matters. So Arvind Subramanian will work with Rajiv Mehrishi on a day-to-day basis.

Mehrishi also has formidable reforms credentials going by the big policy initiatives he took in Rajasthan under Chief Minister Vasundhara Raje. In fact, Mehrishi is credited for much of the economic reforms initiative undertaken by the chief minister, both in her current term as well as her previous stint in office. In many ways, she found Mehrishi indispensable as her policy advisor. So after taking charge as Chief Minister last year, Vasundhara promptly asked Mehrishi, who was then Secretary, Department of Fertilizer at the Centre, to join her government. He could not say no.

Within months of moving to Rajasthan, Mehrishi made waves with his Labour Law reforms. He also rewrote the newly-amended land acquisition law which many argue is procedurally difficult to implement. Since land is a state subject, the Vasundhara Raje government is rewriting the law without diluting benefits for farmers.

Since States also have concurrent jurisdiction over labour laws, Mehrishi made creative changes in various provisions without losing the essence of the legislation. For instance, the Industrial Disputes Act says a formal trade union can be formed with a minimum 15% of the work force. This resulted in a messy situation of multiple trade unions getting formed with 15% of the total workers. This minimum limit was raised to 30% so that the Labour Union is of a reasonable size and scale. Of course it could still result in two unions getting formed, but it will not be as messy as before.

Mehrishi also tweaked the Factories Act which currently says any establishment with 100 workers or above will mandatorily require government permission before shutting down. Rajasthan has now raised the minimum number of workers' limit to 300. So only factories with 300 workers and above need to take permission from the government before shutting down. These amendments are currently awaiting the President's assent. The spirit of these amendments is now being followed by the Centre which announced changes in labour laws yesterday. Vasundhara Raje will not be very happy to lose Rajiv Mehrishi. But she can't do much about it, as it is her own party which rules at the Centre.

Arvind Subramanian, the former Chief Economist of ADB, is also an interesting choice. Subramanian is a firm believer in the rapid rise of Asia, led by China, in the coming years. While most US-based economists tend to argue that the United States will sooner or later bounce back to its position of economic primacy, Arvind argues that the world may be at an inflection point where China's economy and currency will start to dominate much faster than we all imagine. In his much talked about book, "Eclipse: Living in the shadow of China's dominance", it is argued that just as the United States' economy and currency overtook that of England early 20th century, China might do the same to the US in the 21st century. In fact, Modi may have chosen him partially to understand how China and other emerging Asian economies can convert their economic dominance to a strategic advantage.

Arvind Subramanian also believes in pragmatic reforms. For instance, he has argued India is right to assert its position in WTO in relation to the agriculture sector but says it was a tactical mistake not to sign the Trade Facilitation Agreement. Subramanian believes there is enough scope to transfer cash to our farmers without falling foul of the WTO provisions.

Subramanian is also a strong proponent of shutting down public banks rather than recapitalising them, if they cannot stand on their own feet. He has said the good assets of bad banks must be transferred to other well-run private banks - this, he holds, is preferable to injecting loads of  additional capital in government-owned banks which cannot sustain themselves. He is a strong critic of Indira Gandhi and her policy of bank nationalisation. The Sangh Parivar, however, may have different views in this regard. The RSS always admired Indira Gandhi for many things she stood for. Subramanian may have to wade through these complexities which oversimplified western analyses sometimes do not grasp adequately.


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Monday, 6 October 2014

Narendra Modi Decleare Diesel Deregulation Is Fortnight Away


Fortune has smiled on Narendra Modi in the form of a quick and sharp decline in global crude prices. Modi should smile back at Lady Luck and do the right thing - which is to deregulate diesel prices after the election season is over on 19 October. 

Brent crude has fallen below USD 93 a barrel and our oil marketing companies have actually started making money on diesel - possibly around Rs 2 per litre. This is cause for some cheer, but not political stupidity. Modi will reap later what he sows now. UPA sowed nothing for eight years in terms of oil price reforms, and reaped a stunning defeat in 2014. Its belated efforts to raise diesel prices by 50 paise a month from January 2013 - its best decision in 10 years of economic misrule - was too little, too late. 

For the Modi government, the timely drop in global crude prices is a godsend but it would be thoroughly undeserved if the wrong decisions are taken now. Good luck is not forever and the thing now is to use favourable oil prices to sow the seed for better economic harvests later. If it does not do so, the government may well reap a bitter harvest in 2019. Bad luck has a way of biting you in the butt at the wrong time. 

There is, of course, no such thing as the one and only right answer in a situation, and Modi really has two options before him. One is politically easier, and the other is politically tougher. Both are doable. Policy one is to deregulate diesel only on the upside. The economy has adjusted to the higher price of diesel and so the government could say this is the minimum price at which diesel should be sold, but oil companies will be free to raise prices if global crude prices were to rise this winter or later. 

This deregulation on the upside has two major benefits: if oil prices fall, the subsidy bill will fall as oil companies can cross-subsidise LPG and kerosene with higher profits from diesel. Government, ONGC  , Oil India  �and Gail �will save on subsidy support to oil marketing companies (OMCs) like Indian Oil , HPCL  �and BPCL  . If oil prices rise, the OMCs can hike prices from the current threshold. If they fall, they will make higher profits on petrol and diesel and cut the subsidy bill further. This is politically pragmatic and economically bankable. 

The better option would be to do two things simultaneously. Deregulate diesel and propose a monthly increase in kerosene and LPG prices by say, 25 paise a litre and Rs 10 per cylinder, till we ultimately reach market prices or a sustainable level of subsidy. In any event, the government needs to use the Jan Dhan bank accounts to offer cash subsidies instead of lower prices on kerosene and LPG. This means deregulating kerosene and LPG and paying the difference between market and regulated prices as cash into beneficiary accounts. 

This will remove spurious recipients of subsidy and also force economies in the use of kitchen fuels. The first option is politically easier and economically defensible; the second option is politically tougher but economically the best thing to do. Whichever option Modi chooses, we are probably just about two to three weeks away from diesel price deregulation. If we are not, Modi would have squandered his good fortune away.  R Jagannathan Firstpost.com


The writer is editor-in-chief, digital and publishing, Network18 Group

{{ The Guest Post Blogger organization was not involved in the creation of this content. - Dalvi Prabhakar B, Founder & Digital Manager (SEO,SEM,SMO) }}

Wednesday, 28 May 2014

Rupee snaps three-day fall on good dollar inflows


MUMBAI (Reuters) - The rupee snapped a three-day losing streak on Wednesday as dollar inflows related to foreign funds and companies helped offset heavy month-end demand for the greenback from oil and other importers.

Traders also cited occasional dollar buying by the Reserve Bank of India, although the intervention was not believed to be as aggressive as in recent weeks.

Traders will continue to focus on the measures new Prime Minister Narendra Modi led government will take to bring down the fiscal deficit and fight inflation.

"There was good dollar selling seen today, likely some corporate flows as well. Foreign banks were mostly on the sell side while there were importers and state-run firms seen bidding," said A. AjithKumar, a foreign exchange dealer with Federal Bank.

"There is a good technical support for the pair at 58.35 levels which the central bank defended last time. If that level is broken we could see the pair fall more, if not, we could head back towards 59.50 again," he added.

The partially convertible rupee closed at 58.93/94 per dollar compared to 59.04/05 on Tuesday.

Foreign investors have bought a net $1.46 billion in debt over the past four sessions, bringing their total buying so far this month to $3 billion. In shares, despite some modest selling over the past few sessions, net inflows in May are $2.4 billion.

In the offshore non-deliverable forwards, the one-month contract was at 59.21 while the three-month was at 59.76.

By Swati Bhat
(Editing by Sunil Nair) - 28 May 2014

Tuesday, 27 May 2014

Rupee sees worst fall in over two months; eyes set on new finance minister


MUMBAI (Reuters) - The rupee posted its biggest single-day fall in more than two months on Tuesday, dropping for a third straight session, weighed down by continued profit-taking in domestic shares and month-end dollar demand from importers.

After Narendra Modi was sworn in as India's prime minister late on Monday, investors are now focusing on his policies, which will help determine whether a recent rally in the rupee and in shares is justified.

New finance minister Arun Jaitley will be especially important as investors await a new budget, expected by early July, that will need to reassure markets that India can contain its fiscal deficit.

The new government will also need to decide on steps taken by the previous government to curb imports, which helped narrow the current account deficit to $1.2 billion in the March quarter, according to data late on Monday.

India has been able to narrow its current account deficit thanks to hefty foreign inflows, including net purchases of $5 billion worth of stocks and debt in the month so far, taking total inflows this year to more than $14 billion.

"Foreign fund flows have been strong and the continuation of those will be key for the rupee," said Uday Bhatt, a foreign exchange dealer with UCO Bank.

The partially convertible rupee closed at 59.04/05 per dollar compared to 58.71/72 on Monday. It moved in a wide 58.79 to 59.11 band during the session. The unit fell 0.56 percent on the day, its biggest single-day fall since March 20, when the unit had dropped 0.6 percent.

The rupee fell as the Nifty fell for a second consecutive session as investors continued to book profits in recent outperformers such as State Bank of India.

Investors will also focus on gross domestic product data for the March quarter, due to be announced on Friday, while the Reserve Bank of India is set to review policy on June 3.

In the offshore non-deliverable forwards, the one-month contract was at 59.23 while the three-month was at 59.82.

By Swati Bhat
(Editing by Sunil Nair), Published on 27 APril 2014

Nifty falters; investors wait for Modi to deliver


MUMBAI (Reuters) - The Nifty fell for a second consecutive session as investors continued to book profits in recent outperformers such as State Bank of India while they wait for actual policies from Prime Minister Narendra Modi and his new cabinet.

Arun Jaitley, who was named as India's new finance minister, committed himself on Tuesday to repairing public finances and restoring investor confidence. The close party colleague of Modi will also share the defence and corporate affairs portfolios, although only temporarily.

The new government will need to meet high investor expectations, as prospects of a victory by the Bharatiya Janata Party had sent the Nifty up by 25.8 percent to record highs since Modi was named as the prime ministerial candidate for the opposition party in mid-September.

Overseas investors have been especially strong buyers of the rally, but sold a net $14.3 million on Monday, their second session of sales in three, according to provisional exchange data.

"Market is getting into some sort of correction mode now after the election rally. Now the optimism needs to be matched with the fundamentals. I think market will start counting for the next events such as (macro) policy announcements and RBI policy," said Deven Choksey, managing director, KR Choksey Securities.

The broader Nifty closed 0.56 percent lower at 7,318 points, marking only its third daily fall this month.

The benchmark BSE Sensex fell 0.68 percent at 24,549.51 points.

Shares in State Bank of India fell 2.7 percent, adding to their 1.9 percent fall on Monday.
Lenders, especially public sector ones, have been big beneficiaries of the recent rally given expectations they are primed to benefit from a recovering domestic economy. SBI has gained 48.85 percent so far this year.

Other outperformers also fell. Reliance Industries Ltd (RELI.NS) closed 1.25 percent lower and Bharat Heavy Electricals Ltd (BHEL.NS) ended down 5.2 percent.

Mid-caps, which recently posted strong gains, also slumped. Unitech Ltd (UNTE.NS), which gained 77 percent in May, fell 6.6 percent.

Shares in Gail India Ltd (GAIL.NS) fell 7.5 percent after its earnings missed some analysts' expectations. GAIL's January-March net profit rose by 57 percent to 9.72 billion rupees ($165.36 million), and Jefferies said factors including a weak demand environment and subsidy burdens impacted GAIL's earnings, according to a note to clients on Tuesday.

Shares of sugar refiners slumped as sugar futures fell to their lowest in 10 weeks on sluggish demand from bulk consumers ahead of the monsoon season.

However, investors also picked up shares that under-performed the rally, such as exporters that were seen as vulnerable to a stronger rupee.

Shares in Infosys Ltd (INFY.NS) gained 1.27 percent, but were still down 1.5 percent this month, while Dr Reddy's Laboratories Ltd (REDY.NS) gained 0.5 percent, but was down 14.6 percent so far this month.

By Indulal PM
(Editing by Sunil Nair) - publish on 27 May 2014

Tuesday, 20 May 2014

Narendra Modi start An era of responsibility has begun - IANS


New Delhi: An era of responsibility has begun, said PM-designate Narendra Modi who became emotional Tuesday while delivering a speech after being elected leader of the BJP parliamentary party in Parliament House.

Addressing the party's new MPs and other leaders in the Central Hall of parliament, which he visited for the first time and went down on his knees to touch his forehead to the steps leading to it in reverence to the 'temple of democracy', Modi said the majority given to the BJP in the Lok Sabha was "a vote for hope and faith".

"A government should be one that works for the poor and this is why the new government is committed to the poor of the country and dedicated to the youth of the country as well as our mothers and daughters," said Modi, adding: "The celebrations, excitement will go on but the era of responsibility has begun."

Modi's name was proposed by party patriarch L.K. Advani and seconded by other leaders including Murli Manohar Joshi, Venkaiah Naidu, Nitin Gadkari, Sushma Swaraj and Arun Jaitley.

The BJP-led NDA will laterTuesday meet President Pranab Mukherjee and stake claim to form the government.

The Modi-led BJP won a staggering 282 seats in the 545-member Lok Sabha, becoming the first non-Congress party since independence to get a majority on its own. The Congress fell to an embarrassing tally of 44 seats, its lowest ever.

Calling himself a disciplined soldier and vowing to work for the "poorest of the poor", Modi said he would present his government's report card in 2019.

Modi underlined that he should not be seen above the Bharatiya Janata Party (BJP) and credited his party's stunning electoral victory to the BJP's organizational strength. The Gujarat chief minister became emotional when he responded to veteran colleague L.K. Advani's remarks that he had done a favour by leading the BJP in the election.

"Please don't use the word 'kripa' (favour)," Modi said. "A son doesn't do a favour to his mother. A son works with dedication. I treat the BJP as my mother just as India is my mother."

"The party has done me a favour by giving me an opportunity to serve."

Modi said it would be for the first time that the government would be formed under the leadership of a person who was born in independent India.

"We may not have been able to fight for the country's independence but will dedicate our lives to develop this nation and work for the betterment of the people."

BJP president Rajnath Singh described the moment as historic, and said this heralded an era in Indian politics that was dominated by the BJP, with all other parties pushed to a distant second as "others".

"This is an unprecedented, historic moment. Although Janata Party secured a majority in 1977 and ousted the Congress, it was a conglomeration of various parties. The BJP is the first party which has achieved this feat on its own," Singh said and added they have made inroads in states such as Kerala and West Bengal where it had been a non-entity in the past.

Singh said he was "happy and thrilled", and described the day as the fruition of party ideologue Deendayal Upadhyaya's dream of a "strong, self-dependent, and free" India. IANS