Mumbai: Wednesday’s monetary policy announcement is going to be all the more crucial as it is likely to offer some guidance and clarity on the impact of the high-value currency note withdrawal on economic growth and inflation. Market watchers would expect some information on the number of currency notes printed, the deposits with banks and how the Reserve Bank of India plans to manage excess liquidity in the system. Here’s a look at the numbers that will surround the policy rate decision. Inflation continues to soften Consumer price index-based inflation has consistently eased during this financial year, opening up more space for the central bank and the monetary policy committee (MPC) to favour a rate cut. With a growth hit likely from demonetization (although the estimates of its magnitude vary), it is likely that the monetary policy committee (MPC) would look at ways to spur demand.
Posts
Some 200,000 white-clad Indonesians took to the streets of Jakarta to call for the arrest of the city’s governor, Basuki Purnama. Mr. Purnama, who is a “double minority” for being ethnically Chinese and a Christian, riled the sentiments of certain hardline sections in September when he said a Koranic verse had been used to trick voters into believing that Muslims ought not be led by a non-Muslim. Since then, Indonesia has been convulsed by protests, including one near the presidential palace in early November that turned violent. The embattled Mr. Purnama has been slapped with blasphemy charges, and an investigation is ongoing. His political proximity to President Joko Widodo does not appear to have slowed the momentum of the protests. Prior to winning the presidency in 2014, Mr. Widodo was the governor of Jakarta, and Mr. Purnama, a frontrunner in the February 2017 governorship election, is on track to forge a pathway to even higher political office. Mr. Widodo has been silent on the...
Why the Indian Navy’s non-acceptance of the Tejas fighter aircraft should be accepted as a result of evaluation by specialists The Indian Navy’s professional decision not to induct the indigenous Tejas fighter aircraft has given armchair critics a new lease of life. Stand by for a lot of their ‘professional’ views against the Navy especially as the Indian Air Force (IAF) is now out of their cross hairs after its decision to induct 120 Tejas MK 1As — a decision which was born out of no other criterion but a professional assessment. It is time we become wise about how the defence forces go about buying aircraft and other equipment that cost millions of rupees per piece. There are operational pressures too which influence decision-making. In this misplaced assault of the ‘armchairists’, the case of the procurement of the Pilatus PC-7 Basic Trainer Aircraft (BTA) by the IAF from Switzerland as against Hindustan Aeronautics Limited’s indigenous HTT-40 stands out. Procurement road map Ev...
There are good reasons why the ‘Heart of Asia’ conference, part of a 14-nation process begun in 2011 to facilitate the development and security of Afghanistan, is so named. The obvious one is geographical, as Afghanistan lies at the junction of Central, South and East Asia, and also of the ancient trading routes from China and India to Europe. Today it is also a focal point for the region’s biggest challenge of terrorism; some of the far-reaching battles against al-Qaeda, Islamic State, etc. will be decided on the battlegrounds of Afghanistan. For India, putting terror centre stage at the Heart of Asia declaration in Amritsar was thus timely and necessary. In tandem, Afghan President Ashraf Ghani and Prime Minister Narendra Modi focussed their concerns on cross-border terrorism emanating from Pakistan, something even Pakistan’s traditional allies at the conference, including China, Saudi Arabia, the UAE and Turkey, found difficult to counter. The case Mr. Ghani made was clear: progres...
Ousted Tata Sons chairman Cyrus Mistry has asked the government to intervene in the running of Tata Trusts, which hold majority stake in the holding company of the Tata group. Ahead of the extra-ordinary general meetings (EGMs) of Tata group firms, called to remove him as a director in those entities, Mr. Mistry also reached out to shareholders of six group companies to defend his position, spelling out why he should not be removed. Tata Sons, meanwhile, refuted Mr. Mistry’s allegations, stating that only “genuine selfless governance” had illuminated the path for the group in the past century. ‘Governance breakdown’ Seeking government intervention for alleged absence of an appropriate governance structure and ethical behaviour of trustees at the $103 billion Tata group, Mr. Mistry said, “It would be an inherent obligation for the government to remedy and repair breakdown in the governance of such trusts.” The government must ensure that “the working(s) of the Tata Trusts have a defin...
The demand is not so much as to what the repo rate will be on Wednesday, but what the monetary policy committee, including RBI governor Urjit Patel (second from right), thinks growth and inflation will be six months or even a year down the road. Photo: PTI The monetary policy committee (MPC) will start its two-day meeting on Tuesday to discuss and vote on what the Reserve Bank of India (RBI) should do with its policy rates. There are no ready solutions to the monetary shock posed by demonetization, which purged 86% of the currency (by value) in circulation. That said, a thread of clarity over growth and inflation has emerged over the days since Rs1,000 and Rs500 banknotes ceased to be legal tender on 9 November. It is clear that the move will dent consumer demand and hurt growth over the remaining part of fiscal year 2017. Inflation is likely to ease because of depressed demand conditions, but a forecast on inflation is tricky as delays in the sowing of the rabi crop could potentially...
agirsab Dinni, writer, speaking at parallel venueat the 82nd Akhila Bharata Kannada Sahitya Sammelanin Raichur on Sunday. Terming triple talaq, restrictions on going to masjids, bigamy and other Islamic practices as shackles, Dastagirsab Dinni, a progressive writer, stressed the need for raising voices against Islamic fundamentalistic forces, for women’s liberation. He was speaking on Muslim sensitivities in literataure at a session on multiple dimensions of literature at the 82nd Akhila Bharata Kannada Sahitya Sammelan in Raichur on Sunday. The writer went on to point out prevalent anti-women practices which were indeed not preached by Prophet Mohammed. “Prophet Mohammed did not oppose women offering prayers at masjids, but our fundamentalists are doing it. Muslim women are increasingly opposing the practice of triple talaq and bigamy practices. Some are even fighting against these anti-women practices in courts. Literature should voice their woes,” he said. Pointing at the standard ...